Axis Capital Seeks Legal Options After Sebi Prohibits Debt Segment Activities

Axis Capital's Response to Sebi's Ban

Axis Capital announced plans to explore legal remedies after the Securities and Exchange Board of India (Sebi) imposed a ban on the company's debt segment operations. The regulator has prohibited Axis Capital from engaging in any new assignments as a merchant banker in this sector due to compliance violations.

Details of the Sebi Ban

According to Sebi's interim ruling, Axis Capital was found to have provided guarantees for non-convertible debentures (NCDs) in a manner not permitted by regulations. This action was considered a significant risk to the financial system and could disrupt market operations.

Despite this setback, Axis Capital has clarified that it has not undertaken any new assignments in the debt segment for over a year, and only a small fraction (5%) of its total income for FY 2023-24 was generated from this business.

Future Outlook

Looking forward, Axis Capital is committed to compliance and risk management, asserting that it will adhere to all regulatory requirements. The company is currently assessing all legal avenues available in light of the recent developments.