Valuation of unlisted equity shares: mandated discounted net worth and capitalised earnings method, plus due diligence and reporting.
Unlisted equity shares must be valued in good faith by taking the lower of two net worth-per-share measures (basic and diluted for warrants/options) and a capitalised-earnings value based on 25% of industry average P/E applied to audited EPS; the mean of these two values is then discounted by 15% for illiquidity. Valuation relies on audited accounts, is zero where accounts are over nine months old or net worth is negative, treats negative EPS as zero, requires an independent valuer if a security exceeds 5% of scheme assets, permits trustee-approved additional markdowns, and bars purchases above the methodology-derived price except for compliant IPO/firm allotments.

Delay in transfer of shares triggers company liability to compensate for opportunity losses and provide accrued benefits.
Companies must compensate aggrieved transferees for opportunity losses when transfers are not effected or valid objections are not communicated within the stipulated one month, and must provide all benefits that accrued during the intervening period (bonus, rights, dividend). Exchanges must amend Bye Laws to provide an arbitration mechanism to determine compensation for such delays.

Annual Statistical Report requirement: mutual funds must file revised ASR in prescribed simplified format and report unitholding pattern.
Revises the filing requirement for the Annual Statistical Report (ASR), simplifying its format and requiring mutual funds to submit an annual ASR for the entire mutual fund in the enclosed revised format. The ASR must record the unitholding pattern as on the financial year-end by investor categories (Individuals; NRIs/OCBs; FIIs; Corporates/Institutions/Others) showing number of investors and net asset value, and must not be submitted scheme-wise.

Refund of excess fees: brokers' refund requests must be routed through exchanges with certified turnover and fee computations.
The circular requires Exchanges to process refund requests only when a member has paid excess fees and interest, and to forward member refund applications only if accompanied by an Exchange certified turnover statement in the specified Annex C format (hard and soft copy) and a completed fee liability computation; incomplete submissions will be returned for resubmission.

Abolish no delivery period for dematerialised scrips; permit direct close out at reduced mark up using latest closing price.
Abolish the no delivery period for securities in compulsory dematerialised mode, to be implemented by exchanges without extension to coincide with rolling settlement. Permit direct close out of short deliveries where cum purchases cannot be acquired in auction, with a reduced mark up for such direct close outs. The reference price for close out shall be the latest available closing price at the exchange.

Benchmark disclosure for debt and balanced funds now required; performance must be published and compliance reported.
Requirement to disclose benchmark performance for debt oriented and balanced mutual fund schemes in half yearly results, with benchmarks developed by research and rating agencies recommended by AMFI; existing procedural rules on changing benchmarks, management perception, review by AMCs and trustees, and reporting of compliance in AMC quarterly reports and trustees' half yearly reports continue to apply under the governing mutual fund regulation.

Instruction cutoff for settlement: Beneficiary instructions within 24 hours before pay in must be acted on; late instructions at owner's risk.
Execution of Beneficiary Owner's instructions received by Depository Participants within 24 hours before pay-in time is mandated; instructions received after that cutoff may be executed at the risk of the Beneficiary Owner. Depositories must communicate the cutoff to Participants and report compliance to the regulator, and the directive takes immediate effect.

Benchmark disclosure requirement: mutual funds must publish benchmark index performance alongside scheme returns for investor comparison.
Mutual funds must disclose benchmark index performance alongside scheme returns in half yearly reports for equity oriented schemes, selecting appropriate broad or sectoral indices aligned with each scheme's objective. Multiple indices may be shown and any change must be recorded and justified. AMCs and trustees are required to review scheme performance periodically, compare it with benchmarks, consider industry data for corrective action, and report compliance in quarterly AMC reports and half yearly trustee reports to the regulator.

Mailing of mutual fund annual reports replaces newspaper publication; funds must mail abridged reports and display them online.
Regulation 56 is amended to substitute "Mailing" for "Publication," removing the requirement to publish scheme-wise annual reports or abridged reports in newspapers; mutual funds must mail the annual report or an abridged summary to each unitholder and display scheme-wise annual reports on their websites linked to the industry portal. The amendment also deletes the proviso that full portfolio disclosure is unnecessary if full accounts are published in newspapers and updates cross-references to mailing of abridged summaries.

FII trading in exchange traded derivative contracts permitted subject to position limits and custodians must notify FII clients.
SEBI permits Foreign Institutional Investors to trade in all exchange traded derivative contracts on recognised exchanges, subject to position limits, and directs custodians to notify their FII clients while referring to the detailed position limit framework in the referenced circular.

Valuation of securities: benchmark yields and specified fallback pricing rules govern mutual fund NAV valuation uniformly.
SEBI prescribes fallback valuation for non-traded securities: most recent trade within thirty days for non-debt and within fifteen days for debt (private placements eligible for fifteen days at purchase price). A debt security is thinly traded if no marketable-lot trades occur on the valuation date. Government securities yields are grouped by duration to form a volume-weighted risk-free benchmark set at least weekly and reset on significant market moves. Specified discretionary and mandatory discounts over the benchmark apply by rating and duration. The benchmark and government security prices from an AMFI suggested agency must be used for same day valuation.

FII position limits restrict fresh trading on breach while permitting offsetting transactions to reduce derivative exposure.
FIIs may trade all exchange traded derivative contracts subject to position limits: at the FII level index positions capped at 15% of open interest and single stock positions at 7.5% of open interest (each with specified higher floors); at sub account level gross positions on a stock limited to the higher of 1% of free float market capitalisation or 5% of open interest. Exchanges and clearing entities will monitor positions daily using unique FII and sub account codes, with confirmed positions submitted by clearing members; breaches bar fresh positions but permit offsetting transactions. Positions are computed gross for FIIs, net for sub accounts, and valued by open interest times closing price.

Trading under normal rolling settlement: scrips moved to rolling settlement based on depository connectivity and effective dates.
Scrips confirmed by depositories as having established electronic connectivity are to trade in the normal rolling settlement mode. Eight companies with connectivity before October 31, 2001 are effective immediately from January 31, 2002; an additional set confirmed as of December 31, 2001 will be effective from March 31, 2002. The classification and effective dates follow depository-provided connectivity status for transition to rolling settlement.

Rolling settlement on T+3 required, shortening the cycle from T+5 and stock exchanges must implement the change.
Mandate to institute rolling settlement on T+3 for all listed equity securities, replacing the prior T+5 cycle, with the compulsory T+3 rolling settlement to commence on April 01, 2002; stock exchanges must implement necessary system and operational modifications to effect the shortened settlement cycle.

Scrip-wise delivery disclosure mandated; no delivery period for dematerialised scrips; close-outs use previous-day closing price.
Exchanges must publish scrip wise deliverable positions grossed across clients each trading session under compulsory rolling settlement; there will be no "no delivery" period for scrips traded in compulsory dematerialised mode, and where short deliveries cannot be purchased on a cum basis the Exchange may close out the shortfall. In rolling settlement the reference price for close out procedures shall be the previous day's closing price for the scrip.

Investor education on mutual funds: SEBI circulates a brochure and requires dissemination through distributors, websites and training.
SEBI directs registered mutual funds, Unit Trust of India and AMFI to disseminate a question-and-answer brochure on mutual fund fundamentals to distributors, agents and investors, display it prominently on fund websites, and may publish it as booklets bearing SEBI name and logo while allowing publishers to identify themselves; AMFI is asked to include the brochure in training and certification materials and recipients must report on dissemination steps.

Public issue of non-convertible debt securities permitted without prior equity listing, subject to credit rating and disclosure safeguards.
Unlisted companies may publicly issue and list NCDS or DSCE without prior equity listing if they obtain an investment-grade credit rating, secure a prescribed promoters' equity contribution (with staged funding for very large contributions) and a lock-in, agree to continuing disclosure obligations under the listing agreement, obtain special resolution consent of security holders for material changes, ensure no partly paid securities at draft filing, and comply with IPO guidelines when issuing equity or convertible securities during or after the debt tenor. Price band limits and book building may be used for coupon and conversion price determination.

Regulatory directive under Securities Contracts Act requires stock exchanges to amend rules and seek clarifications within set periods.
A regulatory directive under Section 8 of the Securities Contracts (Regulation) Act directs stock exchanges to amend their Rules, Articles and related provisions to implement a SEBI Board decision within a prescribed compliance period, and requires exchanges to submit any queries on the Order to SEBI within a specified short timeframe.

Buy Back of Securities disclosures require advance notice and immediate post-board meeting intimation to stock exchanges.
Companies must notify stock exchanges in advance of board meetings where a Buy Back of Securities proposal will be considered and must immediately intimate the exchanges about the board's decision on a buy-back after the meeting's closure; stock exchanges are to incorporate these Listing Agreement amendments with immediate effect.