In a step toward strengthening transparency and improving the monitoring of listed debt securities, the Securities and Exchange Board of India (SEBI) has issued a new circular dated November 25, 2025, specifying clear timelines for issuers to submit critical information to Debenture Trustees (DTs). This development aims to streamline compliance, enhance due diligence, and create a more efficient oversight system within India’s corporate bond market.
The circular applies to all registered Debenture Trustees, issuers who have listed or intend to list debt securities, and recognized stock exchanges, underscoring the wide-ranging impact of the updated framework.
Why SEBI’s Clarification Is Important
Debenture Trustees are central to investor protection. Their responsibilities include monitoring the issuer’s adherence to obligations, ensuring that adequate security cover is maintained, and verifying the financial position of guarantors. Under Regulations 15(1)(s) and 15(1)(t) of the SEBI (Debenture Trustees) Regulations, 1993, DTs must conduct due diligence on a continuous basis.
The Master Circular for Debenture Trustees dated August 13, 2025, further outlines the procedures for security creation and requires periodic monitoring conditions to be incorporated into the debenture trust deed. However, without standardized submission timelines, DTs often faced delays that hindered effective monitoring.
The new circular resolves these challenges by mandating precise, uniform timelines for submission of essential reports.
Mandatory Timelines for Issuers
SEBI now requires issuers to submit the following documents to Debenture Trustees according to a strict timetable:
1. Security Cover Certificate
Frequency: Quarterly
Timeline: Within 60 days of each quarter’s end, except the last quarter, which must be submitted within 75 days.
This certificate, in the format prescribed under Annex-VA of the Master Circular, enables DTs to verify whether the asset cover remains adequate at all times.
2. Statements on Key Security Components
Frequency: Half-yearly
Timeline: Within 60 days of each half-year’s end.
Issuers must provide:
- Value of pledged securities
- Value of the Debt Service Reserve Account (DSRA) or any other security form
- Net worth certificate of guarantors (in cases involving personal guarantees)
3. Guarantor Financials Based on Audited Statements
Frequency: Annual
Timeline: Within 60 days of the financial year’s end
This requirement applies where debt securities are secured through corporate guarantees.
4. Valuation and Title Search Reports
Frequency: Once every three years
Timeline: Within 60 days of the financial year’s end
These reports help DTs confirm the validity, ownership, and updated valuation of movable or immovable assets provided as security.
Effective Date and Implementation
The provisions of this circular will apply beginning with the quarter ending December 31, 2025. SEBI has published the circular under the “Legal” → “Circulars” section of its website for public access.
A Step Toward Stronger Investor Protection
By setting definitive timelines and reinforcing the accountability of issuers, SEBI aims to enable Debenture Trustees to perform their duties promptly and effectively. The improved framework promotes transparency, reduces delays, and enhances investor confidence—contributing to a more robust and well-regulated debt market ecosystem in India.