SEBI

(SECURITIES AND EXCHANGE BOARD

OF INDIA)
MELVIN BABU
ROHAN SINDOL
ANAND SAGAR
SHAHID S J
UDAYKUMAR
PRASANTH P
 ORIGIN, EVOLUTION AND MILESTONES OF SEBI

ORIGIN AND EVOLUTION OF SEBI

(ANAND SAGAR)

• Securities and exchange Board of India (SEBI) was first established in 1988 as a non-statutory body for
regulating the securities market.
• It became an autonomous body on 12 April 1992 and was accorded statutory powers with the passing of the
SEBI Act 1992 by the Indian Parliament.
• Soon SEBI was constituted as the regulator of capital markets in India under a resolution of the Government
of India.
• SEBI has its headquarters at the business district of Bandra Kurla Complex in Mumbai, and has Northern,
Eastern, Southern and Western Regional Offices in New Delhi, Kolkata, Chennai and Ahmedabad
respectively.
• It has opened local offices at Jaipur and Bangalore and has also opened offices at Guwahati, Bhubaneshwar,
Patna, Kochi and Chandigarh in Financial Year 2013 - 2014.
 EVOLUTION OF SEBI
(ROHAN SINDOL)

Harshad Mehta Securities Scam

• The Legislature speedily approved the SEBI Act, 1992.
The SEBI Act gave SEBI a 3 fold duty-
• Protection function- To protect the stock markets from unscrupulous investors and
to protect the investors from unfair market practices.
• Development Function- To develop the stock markets healthily and lawfully.
• Regulation Function-: To regulate the transactions between brokers, investors and
the stock market to ensure fair play
Satyam Scandal
• Regular monitoring of all transactions by SEBI between investors, shareholders,
brokers and the company.
• Appointment of Independent Directors on the Board to ensure the fair and honest
functioning of the company
• Several audit norms were introduced like the mandatory rotation of auditors/ audit
firms every 5 year
• Several audit norms were introduced like the mandatory rotation of auditors/ audit
firms every 5 year
Sahara Scam
• Sahara India floated 2 new companies- Sahara India Real Estate Corporation
Limited (SIRECL) and Sahara Housing Investment Corporation (SHIC) in 2005.
• In the annual meetings held by both the companies, a resolution was passed to raise
funds through private placement of optionally fully convertible debentures
(OFCD’s)
• SEBI noticed unusual fund raising activity in the 2 firms- SHICL and SIRECL.
• SEBI passed an interim order, ordering the payment of Rs.24, 000 crores + 17%
interest to 30 million investors.
• The government has taken steps to tighten SEBI’s hold on the securities markets
still further and has bestowed more powers on the SEBI.
 MILESTONES OF SEBI
(UDAYKUMAR)

 1st October 2018: SEBI launches its commodity derivatives segment making it India's 1st Universal
Exchange
 01st August 2018: SEBI launches ‘chatbot’, “Ask Motabhai”, for faster, more convenient access to stock
market information
 26th October 2017: India's Premier Stock Exchange BSE and World's largest Insurance Exchange Ebix,
Inc. Sign MOU to Launch Joint Venture Company, for Setting up Pioneering Insurance Distribution
Network in India
 23rd March 2017: SEBI crosses another milestone of raising Rs.200, 111 Crore via the Debt online
platforms
 9th January 2017: Hon’ble Prime Minister of India, Shri Narendra Modi inaugurated India International
Exchange (IFSC) Ltd, India’s 1st International Exchange
 9th July, 2016: Shri Arun Jaitley, Hon'ble Minister of Finance Unveiled the Commemorative Postage
Stamp Celebrating 140 glorious years of SEBI
 ROLES AND FUNCTIONS OF SEBI
(MELVIN BABU)

ROLES OF SEBI

 Issuer of securities: companies issuing securities are listed of the stock exchange. SEBI ensures that the
IPOs and follow up public offers can take place in a healthy and transparent way.

 Protects the interest of traders and investors: Capital markets functions because of traders and
investors. SEBI safeguards the interests ensuring the investors don’t become prey to any stock market
fraud or manipulation.

 Financial intermediaries: SEBI acts as mediators in the stock market. Monitors all intermediaries such
as brokers and NBFCs.
FUNCTIONS OF SEBI

Protective functions
 Checks on prices rigging: Price rigging refers to manipulating the prices of securities.
 Prevents insider trading: Insider refers to directors, promoters of the company. These people have sensitive
information which they can use to make profit. SEBI keeps a stringent check whether insiders are buying
securities of the company.
 Prohibits fraudulent and unfair practices: SEBI does not allow companies to make misleading statements.

 Developmental functions
 Promoting training of intermediaries of the securities market.
 Promote activities of stock exchange by adopting flexible methods such as internet trading.
 Initial public offer of primary market is permitted through stock exchange.

 Regulatory functions
 SEBI registers and regulates the working of mutual funds and other investment options.
 SEBI regulates takeover of the companies.
 SEBI conducts inquiries and audit of stock exchanges.
 CORPORATE ACTIONS OF SEBI
(SHAHID SJ)
 Strengthening of surveillance and monitoring mechanisms. Steps were taken at the level of the
SEBI and the stock exchanges under the oversight of the SEBI to improve and strengthen their
surveillance capabilities.

 Meetings of the Inter Exchange Market Surveillance Group. The Group discussed market trends,
various risk containment measures that needed to be revised and new measures to be implemented.

 Uniform intra-day price band of 10 per cent. There is a price variation cap of 25 per cent during a
settlement which was uniformally implemented by all the stock exchanges. The intra-day price
variation was flexible in range upto 10 per cent subject to the settlement variation cap of 25 per cent.
Now, it is implemented uniformly at 10 per cent intra-day variation by all the stock exchange

 Price bands in respect of infrequently traded scrips. • There was a need to have a uniform
guideline in respect of price bands on infrequently traded scrips. A small group was formed
comprising of representatives of Mumbai, NSEIL and Delhi stock exchanges to frame guidelines
and a basis on which such price bands could be fixed. The group has already given some
deliberation on this issue and their final report is expected shortly.
 LATEST DEVELOPMENT OF SEBI
(PRASANTH)
 SEBI comes out with disclosure format for listed debt securities :
On Jan 17 2020 disclosure on half year basis about deviation in the use of the proceeds from the objects
stated in the offer document for the year ended march 31 2020 .

 SEBI moots splitting investment advisor , distributor role :

On 16 Jan 2020 has proposed a cap on investment adviser fees and client segregation for entities
providing both advisory and distribution services .

 SEBI allows stock exchanges to launch ‘option in goods ‘ in commodities .

 FPI’s : SEBI exempts certain entities from clubbing of investment limit :

On 16 Jan 2020 certain overseas government agencies and other related agencies will be exempted . The
exemption would be applicable where the Indian government has entered into some agreements with
overseas government .

 Hedged trades may cost less as SEBI likely to lower margin requirement :
On Jan 16 2020 the cost of hedged trades will soon dip in the Indian stock Derivates market .
REFERENCES
https://en.wikipedia.org/wiki/Securities_and_Exchange_Board_of_India
https://www.careerlauncher.com/blogs/role-securities-exchange-board-india-sebi/
https://economictimes.indiatimes.com/markets/sebi
https://indianexpress.com/article/explained/from-early-battles-to-position-of-strength-evolution-of-sebi-2/