Entities, which provide research reports on securities, will have to compulsorily apply for registration with markets watchdog Sebi by end of May 2015 under new norms that came into effect from this month.
However, individuals employed as research analyst with an entity are not required obtain registration certificate from Securities and Exchange Board of India (Sebi).
Besides, the new set of norms for research analysts which came into effect from December 1 also require journalists who offer opinion on securities and public issues through media, to obtain registration with the capital market regulator.
"Transition period of six months from the date of commencement of Research Analysts (RA) Regulations has been provided to the existing persons acting as research analyst or research entity before commencement of the RA Regulations to comply with certification, qualification, segregation of research activity from other activities, etc," Sebi said in a public communication.
"However, they are required to file an application for grant of registration within the said period of six months from the commencement of the regulations that is December 1, 2014, to continue to do so thereafter," it added.
Entities which fail to file an application for grant of registration within the time period of six months would have to "stop acting as research analyst".
"If any person is found to be acting as research analyst without making an application for grant of registration under RA regulations after expiry of such period that is May 31, 2015, appropriate action as deemed fit...May be initiated," the market regulator said.
Interestingly, Sebi regulations also cover individuals including journalists who make public appearance or make comments through the public media for giving opinion or recommendations concerning securities or on public offers.
"Journalists employed by various news organisations and who comment on specific stock with proper research, which get published in news paper, etc have to comply with provisions... of Sebi (Research Analysts) Regulations, 2014," Sebi said.
However, the norms do not cover communications through public media related to general trends in the securities market, discussions on the broad-based indices, commentaries on economic, political or market conditions.
Besides, persons offering statistical summaries of financial data of the companies, technical analyses relating to the demand and supply in a sector or index based on trading volume and price on public media do not require registration as a research analyst.
Sebi also clarified that journalists who are on the payrolls of media agency such as newspaper or television "are not required to get registered with Sebi".
Registration would be mandatory if such media persons make public appearance or offer opinion concerning securities or public issued through public media.
