Sebi mandates granular disclosure for certain FPIs, prescribes timeline
₹25,000 crore will be required to comply with additional granular disclosure requirements. However, FPIs having a broad-based, pooled structure with a widespread investor base, ownership interest by the government, or government-related investors may not pose significant systemic risk.
Accordingly, government and related entities such as central banks, sovereign wealth funds and public retail funds registered as FPIs have been exempted from making such granular disclosures. With regard to additional disclosures, the regulator said FPIs holding more than 50 per cent of their Indian equity AUM in a single Indian corporate group will have 10 trading days within which they can bring down their exposure.
Post this, such FPIs will have to make additional disclosures Additionally, such FPIs will not make fresh equity purchases of any company belonging to the corporate group during the next 30 calendar days from the date of exceeding the threshold. Similarly, the FPIs holding more than ₹25,000 crore of equity AUM in the Indian markets will have 90 calendar days to bring down their holding, after which they will have to make the additional disclosures.
Accounts of all such FPIs will be blocked for further equity purchases until the holding is brought below ₹25,000 crore. Going by the circular, FPIs whose investments continue to exceed the prescribed threshold after the expiry of these timelines will be given 30 trading days to make disclosures, after which their registration will become invalid.
The FPI will then liquidate its securities and exit the Indian securities market by surrendering its registration within 180 calendar days from the day the certificate becomes invalid, according to the circular. During these 180 days, the
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