Context: SEBI Open-Market Buybacks Reintroduced
The Securities and Exchange Board of India approved the reintroduction of open-market share buybacks, reforms to deepen the Municipal Bond market, and faster transmission of securities to legal heirs.
Municipal Bonds
Municipal Bonds are debt instruments issued by Urban Local Bodies to raise funds for urban infrastructure.
Uses of Municipal Bonds
Funds can be used for:
- Roads
- Water supply
- Sewage projects
- Metro projects
- Smart-city projects
- Other urban infrastructure
Flow
Urban Local Body
→ Raises funds from investors
→ Pays interest and principal
Share Buyback
A share buyback means a company purchases its own shares from existing shareholders.
Effects of Buyback
- Reduces shares available in the market.
- Improves Earnings Per Share.
- Often signals confidence in future growth.
- May return surplus cash to shareholders.
Open-Market Buyback
Open-market buyback means shares are repurchased through stock exchanges during normal trading hours.
Securities and Exchange Board of India
Established
- 1988
Statutory Status
- Securities and Exchange Board of India Act, 1992
Ministry
- Ministry of Finance
Core Functions
- Protect investor interests.
- Regulate securities and capital markets.
- Prevent insider trading.
- Prevent unfair trade practices.
- Regulate listed companies, intermediaries and market infrastructure.
PYQ Link
Business Responsibility and Sustainability Report is mandated by SEBI, not RBI.
BRSR disclosures are largely non-financial in nature.
