SEBI says it eased disclosure norms for foreign investors but some FPIs want more

On March 15, India's market regulator decided to exempt foreign portfolio investors from the need to make additional disclosures relating to corporate groups, wherein the investor has already parked 50% of the total assets under management in the country, subject to certain conditions.

However, not every FPI is happy. "Ideally the exemption should have been extended to several other categories of FPIs. For instance, FPIs owned by private equity funds especially those managed by large listed PE firms," said Pulkit Sukhramani, a partner in securities laws litigation team at J Sagar Associates.

The conversation began with a SEBI circular in August 2023, which asked select foreign investors, who had invested most of their money in one company or group, to provide granular details of their beneficial ownerships, economic interest and control.

Such concentrated control was a concern for the Securities and Exchange Board of India (SEBI), especially in companies that have no identifiable promoter.

Some of the examples of such companies, which are managed by professionals and do not have a clear promoter, include Larsen and Toubro, ICICI Bank, ITC, Federal Bank, and IEX.

"A number of FPIs are known to have approached SEBI for specific exemptions. The relaxation proposed is unlikely to address practical challenges which several FPIs are facing," Sukhramani added in a statement shared with CNBC-TV18.