SEBI whole time member Ananth Narayan on Friday said unregistered investment advisors/research analysts are a “menace” who are cashing in on the rising interest in investments.
Since October 2024, SEBI has worked with social media companies to bring down over 70,000 misleading handles/posts, Narayan said at an event organised by the Association of Registered Investment Advisors (ARIA). “While we need more IA/RAs, we also need more self-regulation,” he said, adding that the ARIA should perhaps aspire to become a quasi-SRO and foster an all-round trust. “The Amfi model is something we could perhaps aspire for.”
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According to Narayan, SEBI Market Intermediaries Regulation and Supervision Department team has undertaken measures to help improve the ease of doing business for IAs/RAs. “We have also put out consultation papers in this regard.”
Amid concerns over foreign portfolio investors selling equities, the SEBI member said overall flows are not as bad as one would imagine and stressed that FPIs “remain invested” in India. As of February 2025, they held Rs 62 lakh crore (well over $700 billion equivalent) in equity, and about Rs 5.9 lakh crore ($68 billion) in debt. The recent trend of higher FPI inflows in debt compared with equity (on the back of India’s inclusion in global indices) has perhaps helped improve the portfolio mix a little bit,” he said.
Lauding the surge in domestic flows, especially from mutual funds, Narayan said the supply of quality investment options is essential, and pointed out that in FY24, there was only Rs 2 lakh crore of equity issuances, against flows of Rs 5 lakh crore by MFs and FPIs. “Adequate supply of fresh paper, in line with the demand for such papers, spurring fresh businesses and economic activity, is crucial for sustained capital formation and stable markets,” he said.
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Narayan advised investors to remain aware of risks. They should undertake responsible financial planning backed by appropriate asset allocation, he said.
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