SEBI wants public feedback on guidelines seeking more transparency from foreign investors

In the Hindenburg Research report which maede serious allegations of fraud against the Adani Group, the name Vinod Adani appeared more than Chairman Gautam Adani. This was because Vinod was the link between offshore firms, which were allegedly used for routing funds back into Adani stocks for inflating their value to secure loans against them.

After struggling to obtain information about Adani's FPIs, the securities and exchange board of India is batting for more transparency about foreign ownership in domestic firms.

Seeking feedback from the people

SEBI has opened up consultation papers about guidelines on additional disclosures by foreign investors, for comments from the public.

The guidelines are meant for FPIs which have assets under management worth more than Rs 25,000 crore in India.

They will also cover high risk FPIs which have a concentration threshold of more than 50 per cent in one company, and three months will be set as the deadline for additional disclosures.

Benefits for new investors

At the same time, SEBI will allow new investors starting off in India, to raise the threshold in a firm beyond 50 per cent for six months, after which they'll have to provide additional disclosures about ownership.

The new guidelines are meant to prevent firms from misusing the FPI route and stop them from circumventing the minimum public shareholding norms.