Sebi eases listing agreement for debentures

The Securities and Exchange Board of India (Sebi) today has relaxed listing agreement for debentures. It has allowed companies issuing debentures on private placement, to submit their unaudited half-yearly results to the stock exchanges, instead of quarterly basis.

Amending the Listing Agreement for Debentures, the regulator said "it has been decided to rationalise the provisions of the continuous disclosures made by issuers who have listed their debt securities and not their equity shares; and to introduce submission of unaudited financial results with limited review."

Analysts said the regulator was easing the guidelines with an objective to encourage more companies to tap the debenture market, which has been lying low for some time now.

With the amendment, the debenture issuer companies would now be submitting unaudited half yearly results instead of unaudited quarterly results.

However, the half-yearly accounts would be subject to a limited review, which has to be done by the statutory auditors of the company. The Sebi has also made changes to the format which is to be used for reporting of the limited review.

"The revised clauses of the listing agreement would come into force for all filings made to the stock exchanges after April 1,2007," a circular issued by Sebi official Parag Basu said.

The regulator has also asked the stock exchanges to monitor compliance with the submission of financial results, based on quarterly/half-yearly returns submitted by companies and communicate to the Sebi status of implementation of this amendment.