High-value debt listed entity

Recently, the Securities and Exchange Board of India (SEBI) has proposed a review of corporate governance norms for a high-value debt-listed entity.

About High-Value Debt Listed Entity –

An entity which has listed its non-convertible debt securities on a recognised stock exchange and has an outstanding principal value of listed non-convertible debt securities of 500 Crore and above will be categorised as a ‘High-value debt listed entity’

What are ‘Non-Convertible Debentures (securities)?

• Debentures are long-term financial instruments which acknowledge a debt obligation towards the issuer.
• The debentures which cannot be converted into shares or equities are called non-convertible debentures (or NCDs).
• To compensate for this drawback of non-convertibility, lenders are usually given a higher rate of return compared to convertible debentures.
• In India, usually, these have to be issued with a minimum maturity of 90 days.