No need for Sebi to comment on small, mid-cap slump: Madhabi Puri Buch
Subscribe to enjoy similar stories. Securities and Exchange Board of India (Sebi) chairperson Madhabi Puri Buch said on Friday that there was no need for the regulator to comment on the recent slump in mid- and small-cap stocks, pockets of the market whose high valuations had prompted her to raise concerns last year.
Speaking at an event in Mumbai, the regulator drew from her statement of March 2024 where she had warned investors about the potential bubbles in the small and mid-cap segments, and stressed that it might not be appropriate to allow froth to keep building up. She had asked mutual funds to frame a common policy to protect investors, at a time of turbulence in an overheated small and mid-cap space.
Sebi had also asked for results of stress tests from mutual fund trustees, stating the time it would take to liquidate portions of investors’ portfolios. "At the point in time when the regulator felt the need to make a statement about it, the statement was made", Buch said, "Today, the regulator feels no need to make an additional statement".
Stock prices of small- and mid-cap companies, which outpaced large-caps for most of FY24, have been faltering amid sustained sell-off sparked by growth slowdown and trade tensions. The Nifty Small Cap 100 index has lost about 18% of its value so far in 2025, while the Nifty Midcap 100 index has dropped 13%.
The two indices are each down close to a quarter since their September peaks. Buch was speaking at an event organised by the Association of Mutual Funds in India (AMFI), which launched three strategic initiatives – Chhoti SIP - Sachetization of Mutual Funds, Tarun Yojana, and MITRA - Mutual Fund Investment Tracing and Retrieval Assistant — to advance financial inclusion and
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