Sebi Allows Subscription of Non-Convertible Securities During Trading Window Closure
In a recent update to insider trading regulations, the Securities and Exchange Board of India (Sebi) has given the green light for market participants to subscribe to non-convertible securities (NCS) even during trading window closure periods. This means that investors can now take advantage of NCS offerings without being restricted by the usual trading window rules.
However, the trading window restrictions will still apply to certain transactions, such as acquiring shares through the conversion of warrants or debentures, participating in rights issues, further public offerings, preferential allotments, buy-backs, and open offers.
Sebi’s decision to allow NCS subscriptions during trading window closures comes as an update to previous exemptions granted in a 2020 circular, which included rights entitlements and offer-for-sale transactions.
The circular issued by Sebi directs all stock exchanges to inform listed companies about these new provisions and ensure that the information is easily accessible on their websites. The change is effective immediately.
This update is expected to boost investor confidence and simplify the process of subscribing to non-convertible securities, which are an important financing tool for many companies. By making it easier for investors to participate in NCS offerings, Sebi is working to create a more transparent and investor-friendly market environment.
