They say every season in the markets comes with a scent. Winter is cold cash. Summer is blind hope. But June 2025? June smelled like movement. Not just the ripple of rupees or the rustle of share certificates—it was the smell of something older, deeper. Like an institution shifting on its own axis.
You could feel it on the floor of the BSE. That kind of vibration just beneath the chatter, below the tickers. Not just another bull run. Not just another hot IPO cycle. This was different. This was the market finally answering the knock it had ignored for years— reform, real reform, was here.
By then, India had already raised ₹1.6 trillion in IPOs the previous year. The air was thick with filings—over ninety companies crowding the SEBI pipeline, aiming to raise another trillion in 2025 alone. But most of those weren’t for fresh capital. No, these were exits. Promoters easing out. Private equity funds cashing in. Founders, sitting on years of paper wealth, eyeing the door. You could call it liquidity—but it felt more like escape.
And behind all this, the Government stood waiting. The 2025-26 Budget had a number in it—₹47,000 crore in disinvestment. And DIPAM, the Department of Investment and Public Asset Management, had its hit list—Shipping Corporation, BEML, CONCOR, maybe even the relics of India’s steel and engineering heritage. The strategy wasn’t subtle. Sell what could be sold, privatize what could be privatized, and above all—do it fast.
But fast was never SEBI’s thing. Not until Tuhin Kanta Pandey walked in.
Pandey wasn’t the kind of bureaucrat who arrived with a smile and a slogan. He didn’t talk like a reformer; he acted like one. When he took over SEBI in March 2025, most insiders expected him to bring the same mindset that had shaped his years at DIPAM. But they didn’t expect him to move this quickly.
On June 18, he did.
That day, SEBI held what some are calling the most consequential board meeting in a decade. By sundown, the capital markets had changed shape—quieter, smoother, meaner. The headlines said “reforms.” But if you listened closely, the markets were whispering another word—clearing.
SEBI’s new chair didn’t believe in overregulation. He believed in alignment. Regulation, he told people, was like traffic lights—you don’t want too many, or too few. You want them just when and where they’re needed. It sounded harmless enough. Until you saw what that meant in practice.
Start with the delisting reform. If there was one place where the government’s disinvestment dreams repeatedly stalled, it was here. PSU after PSU tried to delist—and time after time, they failed. Reverse book building, minority shareholder resistance, volatile pricing. The process was a swamp. And everyone—investors, DIPAM, even SEBI—knew it.
June 18th cut through it.
The new rule was brutally elegant—if the government already held 90% of a PSU, it could buy out the remaining shareholders at a fixed price, set at a minimum 15% premium above the floor price. No more reverse book-building. No more shareholder vetoes. No more drawn-out sagas that died in procedural quicksand. The price was declared upfront, the process was finite, and the exits were real.
It wasn’t subtle. But it worked.
Critics said it stripped minority investors of bargaining power. SEBI’s answer? Those shareholders still had a year to sell at the same fixed price, post-delisting. And if they didn’t? Their shares would be transferred to the Investor Education and Protection Fund. Cash settled. No one left holding dead stock.
Behind the scenes, DIPAM and SEBI had been orchestrating this for months. It wasn’t a surprise. It was a slow-boiled revolution.
The rule didn’t apply to banks, NBFCs, or insurers—sector regulators still had their fingers in those pies. But for the rest? This was a greenlight for clean exits. No negotiation. No delay.
The numbers told the story. If you were a minority investor in a sleepy PSU where the government already owned nearly everything, your choices just shrank. You could take the 15% bump and go, or wait a year and have it handled for you. But the government was no longer waiting. It was moving.
For promoters, especially in the startup world, the message from SEBI’s June overhaul was different—but no less loud.
In the past, founders who raised capital through convertible securities—CCPS, CCDs, SAFEs—faced a hard wall when going public. Shares issued from those instruments had to sit locked in for a year. They didn’t count toward the mandatory 20% promoter contribution. Which meant, unless you structured things perfectly from the start, your pre-IPO cap table could trap you.
SEBI tore that page out.
Now, if the conversion happened before the DRHP filing, those shares were fair game. Lock-in waived. Contribution counted. Even AIFs, PE funds, or insurers holding converted shares could see those shares count toward the promoter pool—if they were reclassified accordingly. Suddenly, the rules caught up to the modern startup.
And those promoter ESOPs? Previously forbidden. Now allowed—if granted at least a year before the IPO filing. It was a clean deal—reward long-term commitment, avoid last-minute self-gifting.
It wasn’t just a nod to startup founders. It was a structural invitation. Come home. Flip your companies back to India. Bring your holding structures with you. We won’t punish you for it.
This one rule—this single change in the lock-in logic—could tilt the IPO destination calculus. Founders who once stared at Nasdaq might now see NSE with new eyes.
But the changes didn’t stop with exits and IPOs. SEBI had its eye on something even more fundamental—how the market itself moved. Not just the rules of the game, but the format of play. If delisting was about clearing the exits, then this next reform was about cleaning the stage.
Because as late as 2025, some pre-IPO shares were still… paper.
You’d think that problem had died a decade ago. But like a ghost clinging to a century-old house, paper shares hadn’t left India’s cap tables just yet. Promoters, old directors, legacy employees—some of them still held physical certificates. And those certificates, when traced, often led to messy trails—family disputes, unclaimed estates, missing signatures. Worse, they threatened to delay or derail IPOs right at the final stretch.
So SEBI brought the hammer down.
No demat, no DRHP. It was that simple.
Every significant shareholder—promoters, senior management, key employees, even Qualified Institutional Buyers holding legacy paper—had to dematerialise before the Draft Red Herring Prospectus was filed. Not afterward. Not during. Before.
The rule sent compliance officers into a frenzy. Old employee ESOPs. Legacy investors. Forgotten family trusts. All had to be tracked, verified, and converted. SEBI wasn’t bluffing—this wasn’t a soft nudge. It was a wall. If one certificate was still stuck in limbo, the IPO wouldn’t go forward. Not even to the first page.
But underneath the bureaucracy was a deeper intention—trust.
Paper was vulnerable—lost, forged, misrepresented. With demat, every share had a name, a timestamp, and a digital trail. SEBI was killing the last ghost of old market fraud. It was closing the loopholes used by fly-by-night promoters, shady financiers, and confused inheritors. This wasn’t modernisation for PR. It was defense.
And it worked.
Depositories reported a spike in demat conversions by June-end. IPO hopefuls scoured their registrars for loose ends. Law firms updated checklists, added new audit lines, and began marking “physical share trace” as a red-flag issue in diligence reports. You could smell the sweat on merchant bankers who once thought they’d coast through DRHPs with cut-and-paste filings.
Meanwhile, another monster lay twitching beneath the floorboards—disclosure overload.
For years, Qualified Institutional Placements—QIPs—had bloated into hundred-page behemoths. Even though the buyers were supposed to be sophisticated investors, they were still handed disclosure books thicker than legal thrillers. SEBI finally called the bluff—Do they really read all this?
The answer was no. Not really.
So SEBI slashed it down to size.
A new short-form “term sheet” model would now guide QIP filings. The idea was simple—list only what mattered. Recent changes in business. Material risk updates. Litigation of actual concern. Skip the boilerplate, and trust that institutional investors know how to read a balance sheet on their own.
Suddenly, the QIP document wasn’t a ream of recycled filings—it was a live read. Sharp. Precise. Immediate. Tailored to what had changed since the last annual report, not a photocopy of everything that had already been made public.
But with great brevity came great liability.
Lawyers huddled. If something went wrong—if a fund lost money in a QIP based on an omission—could they sue? Would a court say the document was “misleading” for what it didn’t include?
SEBI didn’t give indemnity. It gave logic.
The burden shifted to materiality. If a fact mattered enough to change an investor’s decision, it had to be included—even in a lean document. But fluff? Ancient disputes? Generic macro risks? Leave them out. Focus on what’s new, not what’s already known.
Behind the scenes, legal teams didn’t shrink their work. They grew it. Diligence lists became longer. Just because the document got smaller didn’t mean the process got lazier. If anything, it demanded more judgment—because now every inclusion (and every omission) was a choice. One that had to be defensible.
Boards, too, had to get smarter. Approving a QIP now meant certifying that the leaner disclosure still told the whole truth. That the new format didn’t leave landmines behind.
It was a risk. But it was a good one.
Because markets thrive on clarity. And in an age of infinite data, clarity is compression.
Then came a ghost from another decade.
NSEL. The National Spot Exchange Limited—once a platform, then a scandal, and now, finally, a graveyard. Over 300 brokers had been entangled in a collapse that dated back to 2013. The cases had dragged. Penalties loomed. Reputation hung in limbo.
On June 18, SEBI opened a door.
A one-time settlement scheme, with tight eligibility and clear deadlines. Brokers facing show-cause notices—not criminal charges, not declared defaulters—could apply. The formula was mathematical—pay a fixed fee, based on volumes and trading value. Cap it at ₹5 lakh, add a 0.01% slice of exposure, and apply a short debarment. One to six months, no more.
And just like that, closure became possible.
But not for everyone. Brokers facing criminal cases, or those declared defaulters, were left out. And even if you did settle, a future charge sheet would void the agreement. SEBI wasn’t handing out forgiveness. It was offering efficiency.
Because after twelve years, the question wasn’t guilt. It was oxygen.
Markets needed to move on. SEBI needed to clear its backlog. And brokers—those not yet broken—needed a clean way out.
The scheme didn’t erase the past. But it made space for the present.
By mid-July, applications had begun pouring in. Some firms saw it as a blessing, others as an insult. But most understood the logic. In a system where justice moves slowly, sometimes certainty is worth more than vindication.
SEBI, for its part, showed its new character again. Focused. Transactional. Not looking to punish for the sake of punishment, but to bring stories to an end.
Not every ghost needs to be exorcised. Some just need to be buried.
For all the work SEBI did in June—the exits it streamlined, the paper it burned, the ghosts it settled—it was the quiet deregulations that may have mattered most.
Not the delistings or DRHPs or placement documents. But the slow, steady loosening of the gates between India and the world.
Start with the foreign money.
If you wanted to invest in Indian government bonds as a foreigner in 2024, you needed patience, paperwork, and possibly a degree in regulatory theory. Know-Your-Customer checks, group disclosures, reporting obligations. Even if all you wanted was to buy clean sovereign debt, SEBI and RBI made sure they knew exactly who you were, what you owned, and how you were affiliated.
In June 2025, SEBI changed its tone.
Now, if you’re an FPI investing only in Indian government securities—no equities, no corporate bonds—you don’t need to jump through the same hoops. Group disclosures? Waived. KYC reviews? Aligned with RBI. Reporting material changes? You now get 30 days, not 7.
On paper, it was technical. In spirit, it was open arms.
SEBI had its sights set beyond Mumbai. It wanted J.P. Morgan, FTSE, Bloomberg—all the global bond indices—to take notice. Because inclusion in one of those meant inflows. Not a trickle. Not a river. A flood—tens of billions of dollars of sticky, rule-bound, long-horizon capital.
The message to the world was clear—India wants in.
And for once, we were not just asking. We were preparing.
Meanwhile, back at home, SEBI loosened another knot—one tied around the ankles of every private equity manager who ever tried to do a deal bigger than their fund could handle.
Co-investments.
For years, if an LP wanted to invest alongside an AIF in a specific deal—say, a startup they loved—they’d need a special PMS account, a separate trust, or some off-the-books workaround. It was inefficient. It was messy. And it felt like regulation was punishing engagement.
Not anymore.
June’s reforms created a new concept—Co-Investment Vehicles (CIVs)—ring-fenced schemes under the AIF itself. Same manager. Same umbrella. Different deal.
If Blume Ventures wanted to do ₹100 crore in Zepto, but a few LPs wanted to do ₹20 crore extra? No problem. One co-investment scheme, tied to the same exit terms, no special treatment, all inside the existing AIF structure. Registered. Transparent. Legal.
And only for accredited investors. No riffraff. No side doors.
It was tidy. Elegant. And it brought India in line with how the best private equity systems in the world already worked.
But it wasn’t just a technical win. It was a cultural shift.
Now, GPs could offer real alignment. LPs could deploy more where conviction ran high. Startups got bigger rounds. And everything—from bank accounts to PPMs—ran through the AIF’s compliance machine.
Transparency without friction. Liquidity without chaos.
It was, in a way, the most perfect reform SEBI issued that June—one that didn’t scream in headlines, but whispered to the deepest part of the market’s infrastructure. We trust you to manage more. Just keep it clean.
Together, these changes—foreign investor ease, domestic co-investment flexibility, paperless shares, compressed disclosures, quick exits—formed something that looked less like a rulebook and more like a blueprint.
Not just for regulation. For ambition.
India wasn’t just fixing the leaks. It was remaking the dam.
By July, the writing was on the wall. More founders were prepping IPOs. More PSU stake buyers were sniffing around. Custodian banks were already updating onboarding packets for foreign G-sec buyers. Merchant bankers were revising timelines—IPOs that once took a year to structure now seemed doable in eight months, maybe less.
Law firms had their hands full—updating ESOP templates, redlining DRHP clauses, revising QIP boilerplate, tracking SEBI circulars, coordinating with RBI, DIPAM, and the MCA. It was chaos. It was clarity. It was the kind of legal work that only comes when the rules are finally making room for the deals you always wanted to close.
Even settlement—long taboo in fraud cases—was now a live option. More efficient. Less symbolic. And far more strategic.
But markets don’t run on rules alone. They run on precedent.
And not every precedent is clear yet.
Could that fixed-price delisting model—now just for PSUs—ever be extended to private companies with >90% promoter holding? SEBI said no, for now. But the market knows how precedent creeps. If it works here, it will be lobbied elsewhere. Watch for PILs. Watch for shareholder suits. The line between efficiency and oppression is paper-thin when the price feels unfair.
And those ESOP relaxations? Could they open the door to abuse, if grants are backdated or quietly restructured? SEBI tried to close that with a one-year cooling period. But will that hold in practice?
Will lean QIP disclosures become a trapdoor for litigation if an unmentioned risk later blooms into a scandal? Unlikely, perhaps—but the liability framework now rests on even thinner ice.
And will courts see the NSEL settlements as closure—or as avoidance?
No one knows.
But SEBI is betting on behavior.
That if you give the market a little more trust, it might surprise you by doing the right thing. That the way to build a top-three capital market isn’t to tighten every screw—it’s to loosen the right ones.
And maybe, just maybe, they’re right.
Because what June 2025 showed—more than any single reform, any clause, any gazette notification—is that India is ready to act like it belongs at the grown-ups’ table.
No more clunky IPOs that only look good on paper. No more strategic sales derailed by shareholder holdouts. No more capital flows dying in KYC purgatory. No more thousand-page documents for deals done by professionals.
The market now moves quicker. Cleaner. Smarter.
Yes, there will be litigation. There will be clarifications. Circulars will follow circulars. And yes, someone will push too far. Someone always does.
But for the first time in a long time, SEBI has picked a side—not the side of process, but the side of progress.
If you’re a founder, a fund, a government seller, or a global buyer—this is your window. The gates are open. The guards are still watching, but they’re not blocking the road. Not anymore.
Welcome to the new capital market. You asked for it. Now go use it.