SEBI Makes E-Book Platform Mandatory for Private Debt Issues of ₹20 Crore and Above

Mumbai, 19 May 2025 — In a significant step to enhance transparency and streamline fund-raising processes, the Securities and Exchange Board of India (SEBI) has mandated the use of the Electronic Book Provider (EBP) platform for all private placement debt issues of ₹20 crore or more. The updated framework, announced via circular on Friday, also expands the platform’s scope to include Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs).

This regulatory update follows the recommendations of a dedicated working group and extensive public consultation. The primary objective, according to SEBI, is to improve operational efficiency and bolster investor confidence in private placement mechanisms.

Until now, the EBP mechanism was compulsory for private placements involving debt securities of ₹50 crore and above. The revised norms lower this threshold to ₹20 crore and broaden its application to cover non-convertible redeemable preference shares (NCRPS) and municipal bonds. These guidelines apply to all types of issues—single, shelf, and subsequent—within a financial year.

For the first time, REITs and InvITs will be permitted to use the EBP platform to privately place their units. Issuers of securitised debt instruments, security receipts, commercial papers (CPs), and certificates of deposit (CDs) may also voluntarily choose to access the platform, according to the circular.

To ensure a structured and transparent process, issuers are now required to submit a placement memorandum and a term sheet at least two working days before the issue opens. First-time issuers must do so three working days in advance. These documents must clearly disclose the base issue size and any additional fundraising through a green shoe option, which is now limited to five times the base size. Historical allocations under the green shoe option must also be reported.

In another notable change, SEBI has introduced provisions for anchor investor participation. Depending on the credit rating of the instrument, issuers can allocate a portion of the issue—30% for AAA to AA- rated instruments, 40% for A+/A-, and 50% for lower-rated instruments to anchor investors. These investors are required to confirm their commitment electronically at least one day before the issue opens. Any unconfirmed bids will be added back to the base issue.

To maintain fairness, SEBI has instructed that when multiple bids are received at the same cut-off price, allotments must be made on a proportionate basis. Moreover, the EBP platform must publish detailed bidding data and other issue-related information either by the end of the bidding day or by 1 PM the following day, depending on the closure time of the issue.

Further, SEBI has adjusted the timeline for securing in-principle approval from stock exchanges. For EBP-based issues, approvals must be obtained by T-2 or T-3 days. For issues outside the EBP platform, the approval must be secured before the opening date.

While most provisions are effective immediately, SEBI has allowed a transition period of three to six months for implementing certain clauses related to anchor investor participation, disclosures, and reporting.

The move is widely seen as part of SEBI’s ongoing efforts to foster greater transparency, reduce information asymmetry, and provide a more level playing field for issuers and investors alike.

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