Sebi rejigs panel on alternative investment policy; expands to 25 members

Sebi has reconstituted its alternative investment policy advisory committee, which advises the capital markets regulator on a range of issues that impact further development of the AIF space. The committee has now 25 members, as per latest update with the Securities and Exchange Board of India (Sebi). The panel, which was constituted by Sebi in March 2015, had 20 members when it was last rejigged by the regulator in February 2022. Till now, the committee has submitted three reports on the AIF (Alternative Investment Fund) industry.

The committee is chaired by Infosys co-founder N R Narayana Murthy. Apart from Murthy, the committee includes members from Sebi, Ministry of Finance, AIF players and industry associations. Sebi has replaced Renuka Ramnath, who was chairperson of Indian Private Equity and Venture Capital Association (IVCA), from the list with the association’s new chairman Karthik Reddy.

Besides, Gopal Srinivasan, chairman and managing director of TVS Capital Funds; Gopal Jain, co-founder and managing partner at Gaja Capital; Vipul Roongta, managing director and CEO of HDFC Capital Advisors; Gautam Mehra, Partner at PwC, and Mahavir Lunawat, Director, Association of Investment Bankers of India (AIBI), continue to be the members of the committee.

The panel is mandated to advise Sebi on any hurdles that might hinder the development of the alternative investment industry and any other item relevant to the segment as well as development of the startup ecosystem in India. Also, the committee has been entrusted with the task of advising Sebi on any issues which need to be taken up with other regulators for development of the alternative investment industry.

Investments via P-notes rise to Rs 1.23 lakh crore in July-end, highest since December 2017

Investment in the Indian capital markets through participatory notes rose to close to a six-year high at Rs 1.23 lakh crore in July-end, making it the fifth consecutive monthly increase, on the back of stable macroeconomic fundamentals.

The amount has reached the highest level since December 2017 — when investment through the route stood at Rs 1.25 lakh crore, data with the Securities and Exchange Board of India (Sebi) showed.

Participatory notes (P-notes) are issued by registered Foreign Portfolio Investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly.

They, however, need to go through a due-diligence process.

According to Sebi data, the value of P-note investments in Indian markets — equity, debt, and hybrid securities — stood at Rs 1,22,805 crore at the end of July as compared to 1,13,291 a month earlier.

In comparison, investment through the route was Rs 1,04,585 crore in May-end, Rs 95,911 crore in April-end, Rs 88,600 crore in March-end, Rs 88,398 crore in February-end and Rs 91,469 crore in January-end.

The growth in P-notes generally aligns with the trend in FPI flows. When there is a global risk to the environment, investment through this route increases, and vice-versa.

Market analysts said one of the prime factors for the growth in P-notes investments is the stable Indian economy amid an uncertain global macro backdrop.

Additionally, the slowdown in the Chinese economy has led investors to shift their focus towards India.

Of the total Rs 1.22 lakh crore invested through this route till July, Rs 1.13 lakh crore was invested in equities, Rs 9,531 crore in debt and Rs 299 crore in hybrid securities.

In addition, assets under custody of the FPIs grew to Rs 57.53 lakh crore in July-end from Rs 55.63 lakh crore in the preceding month.

Meanwhile, FPIs’ investment in Indian equities was at Rs 46,618 crore in July, while they also infused Rs 3,726 crore in the debt market.