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The Securities and Exchange Board of India (Sebi) on Thursday proposed a framework for the consolidation of corporate bond market.
The move is to avoid fragmentation of debt market with multiple issues and to help re-issuances.
"Any new issue should preferably be a re-issue so that there are large stocks in any issue, thereby helping to create secondary market liquidity," Sebi said in a circular floated today.
An issuer would be allowed re-issuance and consolidation of debt securities only if they are privately placed and have obtained ratings from credit rating agency, Sebi has proposed.
The Sebi's proposals are based on the Reserve Bank of India's (RBI) RH Patil Committee recommendations on corporate bonds and securitisation.
