SEBI Disclosure Norms

Subject: Economy

Section: Capital markets

Concept :

The Securities & Exchange Board of India (SEBI) mandated that large listed companies must confirm or deny price-sensitive market rumours, and in the case of material board decisions disclose the same to the stock exchanges within 30 minutes.

Details

To bring more transparency and to ensure timely disclosure of material events or information by listed entities, the SEBI board made it mandatory for the top 100 listed companies by market capitalisation to verify, confirm or deny or clarify any market rumours.
This would come into effect from October 1, 2023.
And in the case of the top 250 listed entities by market capitalisation, the deadline to adhere to this norm would be April 2024.
The markets regulator has also made it mandatory for upstreaming of clients’ funds by stock brokers and clearing members to Clearing Corporations.

Significance

This move is aimed at protecting retail investors’ funds in the secondary market.
This will mitigate credit risk on intermediaries and risk of potential misuse of clients’.

Price Sensitive Information

According to SEBI, Price-sensitive information means any information which relates, directly or indirectly, to a company and which if published is likely to materially affect the price of securities of the company.

Material Events

A material event is when your company undergoes a change that would affect the share value of the business. Material events are pivotal situations or changes to the business that would dramatically shift the valuation (value) of the company.