Listed cos must furnish info: Sebi

Availability of information will ensure smooth working of market

Securities and Exchange Board of India (Sebi) on Tuesday suggested that listed Indian entities to disclose sufficient information to the market to ensure transparency and help investors to get a fair understanding of the companies.

At the same time, the market regulator would “focus” on those listed companies, who are not yet ready to share sufficient information to independent research firms,  said Sebi Chairman C B Bhave while speaking at the launch of independent equity research by Crisil here.

Through the research, Crisil seeks to provide independent assessments to investors on the fundamentals and valuations of listed Indian firms  and the grades would be available on a five-point scale and will be reviewed on a quarterly basis.

Investors must look at equity research reports with the knowledge that who has commissioned the report, said Bhave and pointed out that availability of sufficient information was imperative to ensure smooth functioning of the market.  “Even for the regulator, it was important to know investors’ feedback,” he said.

“As we advance, with more access to information, we need to improve the methodology of working.” Also, the availability of research reports on small and mid cap companies will help to improve the liquidity in the market, said he.

Crisil said a detailed equity research report on each graded company explaining the grades will be avilable free of cost on its website.  Only  the top 100 of around 3,500 active listed Indian companies get reasonable levels of equity reserach coverage, according to Crisil.

In a related development, Sebi on Tuesday issued a circular under which merchant bankers were advised to comply with the ICDR (Issue of Capital and Disclosure Requirements) Regulations for an issuer making a public issue or rights issue wherein the merchant bankers were further advised to file five copies of the draft offer documents or offer documents with the office of the market regulator.
In this context, the circular to merchant bankers is made available at Sebi website under the categories “Legal Framework” and “Issues and Listing.”