As it looks at ways to attract more investors into the capital market, the Securities and Exchange Board of India (SEBI) board, has allowed mutual funds to invest in real estate investment trusts (REITs) and infrastructure investment trusts (InvITs) that have been classified as hybrid instruments.
A mutual fund can invest up to 5% of its net asset value in units of a single issuer of REITs and InvITs, while the cap will not be applicable in the case of index fund or sector or industry-specific scheme. The overall limit will be 10% of its NAV in units of REITs and InvITs.
Other than the approval of the measures aimed at reducing the overall transaction cost and protecting the interest of public shareholders, the market regulators board also gave its nod to market intermediaries and companies, to make regulatory payments digitally. “Keeping this objective in mind and taking into consideration the projected income and expenditure of SEBI for the next three financial years, the board decided to reduce the fees payable by brokers by 25% from Rs 20 per crore of turnover to Rs 15 per crore,” SEBI said in a release.
Tightening the settlement norms, the regulator has decided to provide incentives to defaulters coming on their own to settle cases, before the start of enforcement action, even as excessive delays in filing of settlement applications will attract higher charges. As part of measures to protect the interest of public shareholders, the merger norms will also be tweaked under which, very large unlisted companies will be restrained from getting listed by merging with a very small company.
Apart from this, SEBI has also allowed celebrity endorsement of products in the fast-growing mutual funds market and will amend financial criteria for municipalities to issue bonds.