In its board meeting held on June 28, 2023, the Securities and Exchange Board of India (“SEBI”) had approved amendments to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”) requiring listed entities having outstanding listed non-convertible debt securities (“NCDs”) as on December 31, 2023 to mandatorily list their subsequent issuance of NCDs with the stock exchanges.

Pursuant to the same, vide notification dated September 19, 2023, the LODR Regulations have been amended and regulation 62A (Listing of subsequent issuances of non-convertible debt securities) (“Regulation”) has been added.

As per the Regulation:

1. a listed entity, whose NCDs are listed, shall list all NCDs proposed to be issued on or after January 1, 2024 on the stock exchanges;
2. a listed entity, whose subsequent issues of unlisted NCDs made on or before December 31, 2023 are outstanding on the said date, may list such securities on the stock exchanges; and
3. a listed entity that proposes to list its NCDs on the stock exchanges on or after January 1, 2024, shall list all outstanding unlisted NCDs previously issued on or after January 1, 2024, on the stock exchanges within 3 (three) months from the date of the listing of the NCDs proposed to be listed.

It is also pertinent to note that as per the Regulation, listed entities are not required to list the following securities:

1. Bonds issued under section 54EC of the Income Tax Act, 1961;
2. NCDs issued pursuant to an agreement entered into between the listed entity of such securities and multilateral institutions; and
3. NCDs issued pursuant to an order of any court or tribunal or regulatory requirement as stipulated by a financial sector regulator namely, SEBI, RBI, Insurance Regulatory and Development Authority of India or the Pension Fund and Regulatory Development Authority.

Furthermore, as per the Regulation, securities issued by the listed entity under (ii) and (iii) above, are required to be locked in and held till maturity by the investors and shall be unencumbered. Furthermore, a listed entity proposing to issue securities under (i), (ii) or (iii) above is required to disclose to the relevant stock exchange all the key terms of such securities, including embedded options, security offered, interest rates, charges, commissions, premium, period of maturity etc.

Please find a copy of the Regulation, here.

This update has been contributed by Nidhi Arya (Partner) and Ayushi Jain (Associate).

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