Liquidity And Low Interest Rates Are Currently Driving the Stock Markets: SEBI Chairman Ajay Tyagi

The last year has been a year of changes in the market as new IPOs and other instruments have played a new role in shaping the capital markets, industry members pointed out in the 18th Annual Capital Market Conference of FICCI.

The diversification in the participation of markets is currently shaped well with the boom in retail investors and other participants from foreign and domestic institutional investors, members pointed out.

The SEBI being the regulator of markets has played an important role in the different times amid the pandemic. Moving further, the primary market committee is working on whether the Special-purpose acquisition companies (SPACs) should be introduced in India.

Speaking at the FICCI's Annual Capital Market Conference, Ajay Tyagi, Chairman, SEBI, said, "The committee is working on the matter of SPACs. However, we don't have any timelines set for the same as of now."

The chairman also highlighted the efforts of SEBI in reviewing the regime for fundraising in the capital markets. He also assured on the focus of the same to be continued in the future and how the developments in the minimum public shareholding framework will help big companies enter the market.

On the IPOs, Tyagi said, "The funds raised via IPOs in the last five years i.e. 2016-2021 is six times more than that of the preceding five years."

Taking into consideration the point of how debt markets should be structured in the country, Tyagi said, "Debt markets need to be developed the way equity markets are today."

He also encouraged the growth of retail investors in the market and that the liquidity and low interest rates are driving the markets in the last one year. The markets have seen a huge increase in retail participation in the last one year and it is 2-3 times than what it was in the previous year, he said.

The Chairman also pointed out the holes in the disclosures by the company. He emphasized the topic of the investors should get what they deserve from the respective companies and that mandatory disclosure shouldn't be treated as check boxes.

"We ask the companies to ensure better disclosure of material events," said Tyagi.