Need to focus on corporate bond market: Sebi Chief
India Daily Mail , Jul 23, 2020
India’s stock markets have largely recovered from the lockdown shocks in March with over Rs 2 lakh crore capital raised in the quarter ended June and a surge in retail investors and demat accounts, Securities Exchange Board of India (Sebi) chairman Ajay Tyagi said on Wednesday.
He added that policymakers should focus on development of the corporate bond market as it was still one-third of the overall bank credit and restricted to top-rated bonds, enabling only limited issuers to raise debt.
“With around 30 per cent return in this financial year till now, NIFTY’s performance is comparable to the performance of stock indices of the major economies in the world,” Tyagi said at FICCI’s 17th Annual Capital Market Conference CAPAM 2020 through video conferencing.
He noted that Nifty had risen by 48 per cent compared to its lowest value on March 24, despite the challenges of Covid-19 pandemic, and Rs 2.77 lakh crore was raised through debt and equity during April-June 2020-21 – largely from May onwards – versus Rs 2.94 lakh crore in the same period in 2019-20.
“There is no cause for despair,” he said. At the same time, with a note of caution, Tyagi said, “We are all treading untested waters today. Only time will tell how we will reach the shore.”
During June, 10 lakh new demat accounts were opened compared to 5 lakh a month in the pre-Covid era. Tyagi suggested that government securities should be issued in demat form so as to allow retail investors to first invest in risk-free securities before moving to other forms of securities.
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