Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

SEBI proposals aim to reduce loan defaults
Wed, 7 Jan Pre-Open

Indian banks, particularly public sector banks, have been saddled with a lot of bad loans. The major cause has been the policy paralysis during the tenure of the previous government which along with slowdown led to higher defaults by corporate India. This is being tackled by speedy reform measuresin infrastructure by the present NDA government. In addition to this Reserve Bank of India (RBI) feels that banks need to be given additional powers to deal with large defaulters in a more stringent manner. Therefore in a move to crack the whip on wilful defaulters and protect shareholder's interest, stock market regulator SEBI, has proposed a host of punitive measures against them.

Among the proposals suggested by SEBI is that the wilful defaulters should not be allowed to raise funds by selling shares, debt securities and other non-convertible preference redeemable shares to the public. However, wilful defaulters can access capital from existing shareholders through a rights issue or a qualified institutional placement to institutional investors but with full disclosures. Additionally, SEBI has suggested that wilful defaulters be barred from taking over another listed entity but may be allowed to take part in counter offers to thwart hostile takeover bids.

SEBI's proposals aim at tightening the noose around companies that fail to repay debt despite having the wherewithal to do so. By curbing freedom of wilful defaulters from accessing capital markets, SEBI wants to clip their wings and prevent new investors from falling in their trap. The implementation of these measures will go a long way in strengthening the banking system by acting as a deterrent against defaults by huge borrowers.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary


What else is happening in the markets today? Dig in...

Equitymaster requests your view! Post a comment on "SEBI proposals aim to reduce loan defaults". Click here!

  

Views on News

Inflation & Your Investments (Fast Profits Daily)

Mar 4, 2021

Inflation is the buzz word in the world of finance these days. It impacts all of us. Here's how it affects your investments.

What India's Positive GDP Reading Means for Your Equity Mutual Fund Investments (Outside View)

Mar 4, 2021

Given the risks involved, we may witness a sort of 'W-shaped' recovery wherein we would dip again before moving up, explains Rounaq Neroy in this edition of the Daily Wealth Letter.

I'm Back to Where It All Started (Profit Hunter)

Mar 4, 2021

Join us in welcoming research analyst, Aditya Vora, to Equitymaster.

Dollar at 80? (Fast Profits Daily)

Mar 3, 2021

Can the rupee depreciate to 80 against the US dollar? In this video, I'll show you what the charts say.

Motilal Oswal Asset Allocation Passive Fund of Fund: Aims to Benefit from Investing in Multi-Asset Passive Funds (Outside View)

Mar 3, 2021

PersonalFN analyses the features of Motilal Oswal Asset Allocation Passive Fund of Fund and explains the potential this fund has to offer to its investors.

More Views on News

Most Popular

It's the Beginning of a New Bull Phase in Smallcaps (Profit Hunter)

Feb 24, 2021

Last time the smallcap index crossed 19k a big correction followed. Here's what makes it different this time.

Make Rs 5,000 Per Day Trading the Market (Fast Profits Daily)

Feb 25, 2021

In this video, I'll show you how to get started on the path to daily trading profits.

I Believe the Investment of the Year Will Be...

Feb 19, 2021

In this episode, ace trader Brijesh Bhatia talks to us about the best investments of 2021, his profitable trading system, and much more.

The Hidden Tesla in My Great Indian Wealth Project (Profit Hunter)

Feb 23, 2021

An Indian company founded three decades ago in a garage caught my attention...

More

India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms

S&P BSE SENSEX


Mar 4, 2021 (Close)

MARKET STATS