Prior to the onset of reforms in 1991, the capital market structure in India was subject to several controls and opaque procedures. The trading and settlement system was outdated and not in tune with international practices. The raising of capital from the securities market was regulated by India's Capital Issues (Control) Act, 1947. Under it, companies were required to obtain approval from the Controller of Capital Issues for raising funds in the market. In 1992, the Act was repealed and, with this, ended all controls relating to raising of funds from the market. Issuers of capital, however, are required to meet the guidelines of the Securities and Exchange Board of India (SEBI) on disclosures and protection of investors.
As part of the capital market reforms, the regulatory authorities in India have been quite active in governing and watching matters related to capital issues. Companies have also tapped new sources of domestic and international equity/debt to redesign and strengthen their capital structure.
This book gives a vivid account of capital market reforms in India. More importantly, it analyzes the impact of regulatory policy changes on the capital structure of Indian companies.