Description

SEBI amends LODR Regulations 2015, raising the threshold for High Value Debt Listed Entities (HVDLE) from Rs. 1,000 crore to Rs. 5,000 crore and modifying investor service requirements for listed entities.

Summary

SEBI has issued amendment regulations to the LODR (Listing Obligations and Disclosure Requirements) Regulations, 2015, published in the Official Gazette on January 20, 2026. The key amendments include raising the threshold for classification as High Value Debt Listed Entities (HVDLE) from Rs. 1,000 crore to Rs. 5,000 crore in outstanding non-convertible debt securities, and modifications to investor service requirements under Regulation 39.

Key Points

  • Amendment to SEBI LODR Regulations, 2015 notified on January 20, 2026
  • HVDLE threshold increased five-fold from Rs. 1,000 crore to Rs. 5,000 crore
  • Applies to entities with listed non-convertible debt securities (NCDs)
  • Threshold calculation based on outstanding value of existing listed NCDs
  • Entities falling below the revised threshold will not be subject to HVDLE provisions
  • Changes to Regulation 15 regarding applicability of regulations 16-27 to debt issuers
  • Modifications to Regulation 39 concerning investor services for share certificates
  • Effective date: Date of publication in the Official Gazette (January 20, 2026)

Regulatory Changes

Regulation 15 Amendments:

  1. Sub-regulation (1A): Modified to change the terminology and threshold:

    • “Non-convertible debt securities” terminology standardized
    • Outstanding value threshold for HVDLE classification raised from Rs. 1,000 crore to Rs. 5,000 crore
    • Regulations 16-27 applicable to entities meeting this threshold

  2. Proviso to Sub-regulation (1A): Updated threshold references:

    • Annual issuance threshold during the financial year changed from Rs. 1,000 crore to Rs. 5,000 crore
    • Compliance trigger date clarified for entities crossing the threshold

  3. Explanation (2): Deleted from the regulation

  4. Sub-regulation (1AA): Terminology and threshold updates:

    • Clarified language regarding applicability of regulations 15-27
    • Provisions for entities falling below the prescribed threshold
    • New proviso added: Entities no longer meeting the revised Rs. 5,000 crore threshold will be exempt from HVDLE provisions

Regulation 39 Amendments:

Sub-regulation (2) replaced with new provisions concerning:

  • Investor requests for sub-division, split, consolidation, renewal, and exchange of securities
  • Procedures for issuing duplicate shares in cases of lost, old/worn-out, or mutilated certificates
  • Documentation requirements for investor services

Compliance Requirements

For Debt Issuers:

  1. Threshold Monitoring: Entities must monitor their outstanding listed non-convertible debt securities value against the Rs. 5,000 crore threshold

  2. HVDLE Classification: Entities with Rs. 5,000 crore or more in outstanding NCDs must comply with Regulations 16-27 of LODR

  3. Annual Issuance Tracking: Entities issuing Rs. 5,000 crore or more during a financial year become subject to HVDLE provisions from that date

  4. Exemption for Smaller Issuers: Entities previously classified as HVDLE under the Rs. 1,000 crore threshold but below Rs. 5,000 crore are now exempt from HVDLE-specific provisions

For Listed Entities:

  1. Investor Services: Must handle investor requests for share certificate services (sub-division, split, consolidation, renewal, exchange, duplicates) according to updated procedures in Regulation 39(2)

Important Dates

  • Notification Date: January 20, 2026
  • Effective Date: January 20, 2026 (date of publication in Official Gazette)
  • Applicability: Immediate for new classifications; entities currently between Rs. 1,000-5,000 crore outstanding NCDs are relieved from HVDLE provisions

Impact Assessment

Positive Impacts:

  1. Reduced Compliance Burden: Entities with outstanding NCDs between Rs. 1,000-5,000 crore will be relieved from stringent HVDLE compliance requirements under Regulations 16-27

  2. Proportionate Regulation: The five-fold increase in threshold aligns regulatory burden with entity size and market significance

  3. Administrative Relief: Smaller debt issuers will have reduced reporting and disclosure obligations

Market Implications:

  1. Debt Market: May encourage more entities to issue debt securities without triggering enhanced compliance requirements

  2. Investor Protection: HVDLE provisions remain applicable to larger, systemically important debt issuers (Rs. 5,000 crore+)

  3. Regulatory Efficiency: Focuses enhanced scrutiny on entities with higher outstanding debt, optimizing regulatory resources

Affected Entities:

  • Entities with outstanding listed NCDs between Rs. 1,000-5,000 crore will see immediate compliance relief
  • Large debt issuers (Rs. 5,000 crore+) continue under HVDLE framework
  • All listed entities must review investor service procedures under amended Regulation 39

Impact Justification

Significant regulatory change affecting debt issuers by raising HVDLE threshold from Rs. 1,000 crore to Rs. 5,000 crore, reducing compliance burden for smaller debt issuers while maintaining requirements for larger entities