Indian market regulator slashes denomination of privately placed debt

A woman walks past the logo of the Securities and Exchange Board of India (SEBI), at its headquarters in Mumbai

BENGALURU (Reuters) - India's capital market regulator has slashed the denomination of privately placed debt securities to 100,000 Indian rupees ($1,213.22) from 1 million rupees earlier, according to a circular issued on Friday.

The Securities and Exchange Board (SEBI) said it took the decision after market participants requested for a reduction in lot size to encourage greater participation from non-institutional investors.

"If the face value and trading lot is reduced, more investors can participate, which in turn will enhance the liquidity in the corporate bond market," SEBI said.

The pandemic led to lower interest rates for depositors, said Soumyajit Niyogi, director - core analytical group at India Ratings & Research.

This move will act as an enabling factor for retail investors to tap into higher-yielding debt securities, he said. ($1 = 82.4250 Indian rupees)

(Reporting by Chris Thomas in Bengaluru, additional reporting by Bhakti Tambe; Editing by Savio D'Souza)