by The Securities and Exchange Board of India (SEBI) is mulling disclosure requirements for unlisted companies. The move is aimed at increasing transparency and accountability in the unlisted space.
The proposed disclosure requirements would cover a range of areas, including:
- Financial statements
- Corporate governance practices
- Related party transactions
- Material events
The disclosure requirements would be similar to those that apply to listed companies. However, there would be some exemptions for small and medium-sized enterprises (SMEs).
The disclosure requirements are expected to be implemented in a phased manner. The first phase would cover large unlisted companies, followed by a second phase that would cover SMEs.
The disclosure requirements are seen as a positive step by market participants. They believe that the requirements will help to improve the quality of information available to investors in the unlisted space. This, in turn, is expected to boost investment in unlisted companies.
However, some market participants have expressed concerns about the cost of compliance with the disclosure requirements. They believe that the costs could be prohibitive for small and medium-sized enterprises.
SEBI is expected to take these concerns into account when finalizing the disclosure requirements. The regulator is also expected to provide some exemptions for small and medium-sized enterprises.
The disclosure requirements are a significant development for the Indian capital markets. They are expected to increase transparency and accountability in the unlisted space. This, in turn, is expected to boost investment in unlisted companies.
