Anxiety on Bond Street

Sebi's diktat on debt market borrowing isn't enough

The Securities and Exchange Board of India (Sebi) has mandated that listed companies rated AA and above having an outstanding loan of at least Rs 100 crore must borrow 25 per cent of their incremental long-term funding need from the bond market. The regulation, which is aimed at increasing the depth of the market, comes into effect from April 1. The timing could have certainly been better as the bond markets have been nervous in the second half of the current financial year, beginning with the Infrastructure Leasing & Financial Services (IL&FS) defaults, the non-banking finance companies’ liquidity situation, and