SEBI Allows Zero-Coupon Bonds at Rs 10,000 Face Value, Expands Debt Market Access

• SEBI has expanded norms for privately placed debt securities, allowing zero-coupon bonds to be issued at a reduced face value of Rs 10,000.
• Previously, only interest or dividend-bearing securities with fixed maturity and periodic pay-outs were eligible for this reduced denomination.
• The revised framework now includes zero-coupon debt securities, issued at a discount and redeemed at par, with fixed maturity and no structured obligations.
• This move helps investors diversify portfolios and earn compounded returns, while also widening funding options for issuers.
• The new norms apply to all privately placed debt securities proposed to be listed from the date of the circular.

Why It Matters: SEBI's new rule allows zero-coupon bonds at Rs 10,000 face value, boosting investor options and issuer funding.