SEBI Board Meeting: Key Decisions on Buybacks, QTP and Market Reforms

The Securities and Exchange Board of India (SEBI) held a board meeting on June 19, 2026, and approved a wide set of changes covering share buybacks, securities transmission, mutual fund borrowing rules, alternative investment funds, and municipal bonds. The decisions span a broad range of market participants; from listed companies and fund houses to retail investors and legal heirs of deceased investors.

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Open Market Share Buybacks Are Back From August 1, 2026

The most discussed decision from the meeting is the reintroduction of open market share buybacks through stock exchanges, effective August 1, 2026. This route had been removed just about a year ago, following changes in the taxation framework applicable to buybacks. With the revised tax treatment now in place, SEBI has brought back the mechanism.

A share buyback is when a company uses its own funds to repurchase its shares from the open market, reducing the number of shares outstanding. There are two main routes for this: a tender offer, where the company invites shareholders to sell at a fixed price within a set period, and the open market route, where the company buys shares directly from the stock exchange at prevailing prices. It is the second route that is being restored.

Under the new framework, buybacks through the stock exchange must be completed within 66 working days from the opening of the buyback. Companies will also be required to deploy at least 40% of the total funds earmarked for the buyback during the first half of the buyback period, this ensures companies do not sit on the funds and actually use them within a reasonable timeframe. Execution will happen directly through the regular trading mechanism, without the need for a separate dedicated buyback window.

SEBI Chairman Tuhin Kanta Pandey, speaking after the board meeting, said the move is intended to give companies an additional route for buybacks while ensuring equitable opportunity and fair tax treatment for public shareholders. To reduce compliance costs further, SEBI has also made the appointment of merchant bankers discretionary for buybacks, their responsibilities can now be split between the company, auditors, and stock exchanges.

Faster Transmission Process for Small Heirs

One of the more investor-friendly decisions from the meeting is the introduction of a new category called Quick Transmission Processing (QTP), which is designed to speed up the transfer of shares and securities to nominees or legal heirs of a deceased investor for small-value claims.

Under QTP, claims of up to ₹10,000 for physical securities and up to ₹30,000 for dematerialised (demat) holdings can now be processed with minimal documentation. This is specifically meant to reduce the time and paperwork burden on families dealing with small estates, where the legal and procedural requirements have historically been disproportionate to the value of assets involved.

Beyond QTP, SEBI has also doubled the thresholds for transmission through simplified documentation. The ceiling for physical holdings has been raised from ₹5 lakh to ₹10 lakh per listed company, and for demat holdings from ₹15 lakh to ₹30 lakh per beneficial owner. Several procedural requirements have also been eased: the mandatory submission of a PAN card has been removed in cases where PAN details are already linked to the demat account, and the requirement to obtain a court-certified probate of a will has been dispensed with, in line with recent amendments to succession laws. QR-coded death certificates will now be accepted for digital verification.

Mutual Funds: Intraday Borrowing Now Permitted

SEBI approved an amendment to Mutual Funds Regulations, 2026, allowing fund houses to use intraday borrowing to manage temporary liquidity mismatches during the course of a trading day. Such mismatches arise from timing differences between trade settlements, foreign exchange transactions, and derivative obligations.

The key condition is that these borrowings must be repaid in full by the end of the same trading day. They cannot be used to build leverage or take additional market positions. This change is in addition to the existing provision that allows mutual funds to borrow up to 20% of net assets for meeting redemption and payout obligations.

GARUDA: Faster Launches for Alternative Investment Funds

SEBI approved the GARUDA framework; Green-Channel: AIF Rollout Upon Document Acknowledgement for Alternative Investment Funds (AIFs). Under this, regular AIF schemes can now be launched within 10 working days of filing. Schemes meant exclusively for accredited investors and angel funds can be launched immediately upon SEBI registration or filing of the private placement memorandum, without routing through merchant bankers.

According to SEBI data, registered AIFs have grown from 732 to 1,849 between 2021 and March 31, 2026, a 135% rise. Cumulative commitments raised by AIFs stood at ₹15.74 lakh crore, with net investments of ₹6.45 lakh crore as of December 31, 2025.

Other Decisions of SEBI

SEBI approved relaxations for the municipal bond market, allowing municipalities to raise funds for refinancing existing project debt, permitting two or more municipalities to pool resources through a combined finance vehicle, and allowing issuers to offer additional interest or discounts to senior citizens, women, retail investors, and defence personnel to encourage wider participation.

The board also approved a new Code of Conduct for SEBI members, referred to as the 2026 Code, based on recommendations from a high-level committee set up to address concerns around conflict of interest and disclosure requirements for SEBI officials. The SME capital-raising framework was selected for an evidence-based regulatory review in FY27.

Conclusion

The SEBI board meeting on June 19, 2026, included a number of reform initiatives in multiple markets. Reintroduction of open market buy-back through stock exchanges starting August 1, 2026, provides an additional avenue for cash return by listed companies, provided that the process is completed within 66 working days and that 40% front loading is applied. The QTP arrangement and higher thresholds of transmission are designed to resolve an issue which has been an irritant for retail investors and their families for some time now.