SEBI’s move to ease compliance will attract smaller FPIs: Sunil Subramaniam

«When you come and buy, people know that, A) this fund is buying, this person is buying, and half the thing in the market in making money is to be surprised, it is the information asymmetry,» says Sunil Subramaniam, Market Expert.

Can you just dissect this news for us, the fact that the threshold limit for FPI disclosure has gone from 25,000 to 50,000. How important is that? And will that really open a large window?
Sunil Subramaniam: It is very important. And I will tell you, the reason for that is that when you are disclosing, you are giving out a lot of information in the market. And so, when you come and buy, people know that, A) this fund is buying, this person is buying, and half the thing in the market in making money is to be surprised, it is the information asymmetry.

As a big investor, once you buy, people follow in your trail and then you are not able to subsequently buy. So, the 25,000 crore rule was a bit restrictive that you would look for smaller funds to go in and avoid disclosing so that you could go in and buy the good stock and not let other people know about it.
Now doubling this clearly then improves the amount of such small ticket things that can come in because people love to be in privacy. Nobody likes to disclose. It is not that they are trying to hide anything, but just from a market perspective, the surprise element goes away, that is number one.
Second is, Sebi talked about ease of doing business. You look at it from SEBI's own perspective. They have to verify all these disclosures and