Sebi reclassifies REITs as equity: What it means for MFs and investors

Securities and Exchange Board of India (Sebi) has announced a set of reforms aimed at easing compliance for large issuers while strengthening participation and protection for investors.

Under the revised norms, companies with post-issue market capital above Rs 1 lakh crore can gradually increase public shareholding to 25%. If public shareholding is below 15% at listing, it must rise to 15% within five years and to 25% within ten years.

For issuers with 15% or higher at listing, the 25% threshold must be met within five years. Mega-cap companies above Rs 5 lakh crore will follow similar timelines. This phased approach reduces early-stage dilution, limits market volatility, and ensures sufficient stock is available for retail investors.