SEBI board meeting underway; MF costs, IPO rule relief, brokers norms on the table
Published on 17/12/2025 04:39 PM
India’s market regulator, the Securities and Exchange Board of India (SEBI), is set to discuss a wide-ranging reform agenda at its upcoming board meeting, with proposals aimed at lowering mutual fund costs, improving transparency, and easing rules for IPOs.
SEBI is considering a proposal to make mutual fund investments cheaper for investors. One key move under discussion is a clearer break-up of the total expense ratio (TER). Charges such as securities transaction tax (STT), stamp duty, and GST may be shown separately, instead of being embedded within TER. This could improve transparency and help investors better understand what they pay.
The regulator is also weighing the removal of an additional 5 basis point charge linked to exit load. Changes to the existing TER slab structure are also on the table.
SEBI may update the decades-old stock broker regulations framed in 1992, in line with the current market structure and technology-led trading practices.
The board is also expected to discuss a clear and uniform definition for algorithmic trading. The move aims to reduce regulatory ambiguity and bring consistency in supervision of algo-based strategies.
Another key item on the agenda is a review of the closing auction system. SEBI is evaluating ways to strengthen closing price discovery, especially for benchmark-linked products and institutional trades.
SEBI is likely to tighten its internal ethics and governance framework. Discussions may include stricter norms on conflict of interest, gift policies, and overall conduct standards within the regulator.
The regulator is also preparing to ease certain IPO norms. Relief may be considered in disclosure requirements and lock-in rules to make listings smoother without compromising investor protection.
In addition, SEBI may propose easing KYC norms for non-resident Indians, which could simplify onboarding and participation in Indian capital markets.
The proposed measures, if approved, are expected to enhance transparency, reduce costs, and improve market efficiency across segments.