I doubt very much if this is going to make any impact at this stage. There is
On 06/10/2008, ekam ber <[EMAIL PROTECTED]> wrote: > SEBI has removed the 40% limit on P-Notes and has allowed certain > institutions to hold 15% stake in exchanges. > > Capital market regulator, Securities & Exchange Board of India (SEBI) has > announced some major reviews in its policies and new initiatives today. It > has announced the removal of restrictions on the FII holding in > Participatory Notes. It has also announced policy measure to encourage SME > Exchange and has allowed specific institutions to increase their stake in > stock exchanges. > > Relaxation In P-Notes Norms > > In a move aimed at easing foreign fund flow into the Indian stock markets, > capital market regulator SEBI has removed the cap on overseas fund flow > through offshore derivative instruments. Earlier, in the wake of excessive > liquidity in the stock markets, foreign institutional investors (FIIs) were > barred from owning more than 40% of their assets in P-notes(which are > offshore derivative instruments-- ODIs) and were asked to unwind their > holdings in India to comply with the cap within 18 months (which would have > expired in March 2009). > > P-notes are financial instruments issued by FIIs to unregistered overseas > investors who cannot directly invest in equity market. SEBI had imposed the > cap one year back and had met with stiff resistance from investors. > > The proposal which was disclosed on October 16, 2007 led to a free fall with > Sensex losing 1,700 points in early trade on October 17 last year. The > markets later recovered on positive statements from the finance minister and > went on to hit its all-time high in January 2008. > > "A lot has changed since the restrictions on PNs were imposed," said SEBI > Chief CB Bhave today. The SEBI chief also added that he will keep a watch on > global markets before reviewing norms. He also added that SEBI is not > looking at emulating the short sales ban which has been imposed in other > markets. > > The latest move by SEBI could give a much needed fillip to the Indian stock > markets. The benchmark market index Sensex, was down by 724 points and > closed at 11,801 today, its lowest level since September 2006. > > SEBI has also said that it needs to review the structure of FII norms and > unnecessary curbs need to be removed. However, there is a big question mark > whether these changes would lead to fresh fund flow from institutions into > India. This is because global institutional funds have been pulling out of > India and also other emerging markets owing to the global credit crisis > which has led to big fund houses declaring bankruptcy or sell-offs. > > As per a VCCircle analysis US fund houses have been on a selling spree while > the European funds were buying in India. But over the last one week even > European banks have started revealing their soft underbelly which could > shrink fund flow from Europe as well going forward. In that case the easing > of norms related to P-notes may not lead to any major inflows. > > Raising Holding Limit In Stock Exchanges > > SEBI has allowed certain categories of institutions to increase their > holding in stock exchages from the present 5% limit. The SEBI Board has > decided to enhance this limit from 5% to 15% in respect of six categories of > shareholders, namely, public financial institutions, stock exchanges, > depositories, clearing corporations, banks and insurance companies. > > The move is likely to increse the competition among the bourses in India and > could see foriegn stock exchanges (New York Stock Exchange, Deutsche Borse > and Singapore Exchange) who hold stakes in Indian exchanges increase their > stakes. It can also lead promotion of new exchanges as the new entities > would have much more control in these exchanges and would be much more > interested in development of these exchanges. > > SME Exchange > > SEBI has also moved forward with its intention of forming SME exchange/s. > The statement issued by the regulator said that - "In recognition of the > need for making finance available to needy small and medium enterprises, the > Board decided to encourage promotion of dedicated exchanges and/or dedicated > platforms of the exchanges for listing and trading of securities issued by > SMEs. Multiple exchanges or platforms would provide the necessary > competition in this space." > > This is a change in stance from SEBI from when Damodaran was heading SEBI. > Then SEBI had announced that only a single SME Exchange would be set up in > contarast to the recommendation of multiple exchanges now. > > SEBI plans to come up with a framework for recognition and supervision of > such exchanges/platforms. The statement also added that the enterprises with > a post issue paid up capital of upto Rs. 25 crore would be listed on such > exchanges / platforms and trading lot would be Rs 1 lakh. The minimum ticket > size for transactions on the SME exchange would ensure that only high > networth individuals were eligible, so that uninformed investors lose > money. > > Bombay Stock Exchange had earlier launched a separate trading platform > `IndoNext' for SMEs that did not work so well. > > http://www.vccircle.com/500/news/sebi-removes-curbs-on-p-notes-raises-holding-limit-in-stock-exchanges > In an ant colony dew is a flood > > > > > > > > > --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "Kences1" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [EMAIL PROTECTED] For more options, visit this group at http://groups.google.com/group/kences1?hl=en -~----------~----~----~----~------~----~------~--~---
