SEBI Clarifies Listed Debt Entities Must List Transferred Unlisted Debentures After Restructuring

The Securities Exchange Board of India (SEBI) has issued a clarification stating that a listed debt entity which takes on outstanding unlisted non-convertible debentures (NCDs) through a corporate restructuring or business transfer must comply with mandatory listing requirements, even when no fresh debentures are issued and no new International Securities Identification Numbers (ISINs) are allotted.

The guidance was issued in response to an informal query by Ananya Finance for Inclusive Growth, a debt-listed company which had assumed unlisted and unsecured debentures issued by its wholly owned subsidiary Prayas Financial Services on 28 February 2026 as part of a Business Transfer Agreement (BTA).

The Specific Situation

As per the BTA, all assets and liabilities of Prayas, including the unlisted debentures issued in July 2024, were transferred to the parent company, Ananya Finance.

Ananya Finance argued that it had just assumed the existing obligations and had not issued any fresh securities or created any new ISINs and sought guidance from SEBI on whether this was a new issuance which would require a mandatory listing or the transferred debentures could continue without being listed.

SEBI's Position

The regulator rejected the view that the listing obligation could be assessed purely on the basis of the legal form of the transaction. SEBI said that where a listed debt entity assumes and continues obligations relating to outstanding unlisted non-convertible debt securities issued on or after 1 January 2024, those securities fall within the scope of Regulation 62A.

Regulation 62A(1) requires listed entities with listed non-convertible debt securities to list all non-convertible debt securities proposed to be issued on or after 1 January 2024. SEBI said the objective of this provision is to bring such securities within the regulatory framework and subject them to disclosure norms and investor protection requirements.

In a corporate restructuring involving the transfer of a business, liabilities attached to outstanding unlisted debentures effectively become the obligations of the listed entity and must therefore comply with the regulation.

Listing Process

On the question of how to proceed with listing, SEBI said the operational requirements covering ISINs, depository records and listing formalities are governed by the framework prescribed by recognised stock exchanges and depositories. The applicant must comply with those requirements in effecting the listing.

SEBI noted that interpretive letters reflect the position of the concerned department based on the specific facts presented and do not constitute a binding decision of the SEBI Board.

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