SEBI plans to move corporate bond sales online in market overhaul

Mumbai: The Securities and Exchange Board of India (SEBI) has planned to revamp the corporate debt market by converting all debt issuance onto an electronic platform by November 2015 with a view to increase supervision of the US$ 225 billion market dominated by a few heavyweight issuers. The market regulator will announce the proposal drafted within a few weeks. India would be among the first countries to move the debt market online. In India, almost 90 per cent of corporate bond issuances are private placements. Issuers hire investment banks to find buyers. Since SEBI has very little control in this system, investors have complaints regarding issuers cancelling the deals even when they have been announced, if the price is unfavourable. An online platform is expected improve transparency and thus investor confidence in the sales process. It will help attract more buyers, including foreign investors, which in turn would lure in more issuers.

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