Markets regulator Sebi on Thursday relaxed rules to allow issuers to sell debt securities at a lower face value of Rs 10,000 even if they are zero-coupon instruments, provided they have a fixed maturity and no structured obligations.
As a result, issuers can now issue debt securities at a reduced face value that are either interest-bearing or zero-coupon in nature, according to a circular issued by the Securities and Exchange Board of India (Sebi).
Sebi, through a circular in July 2024, allowed companies to issue certain debt securities like bonds or non-convertible redeemable preference shares with a reduced face value of Rs 10,000, down from higher amounts, to make them more accessible. However, this only applied to securities that paid regular interest or dividends.
1 December 2025
Get the latest issue of Outlook Business
Market participants highlighted that zero-coupon bonds do not offer periodic interest but are issued at a discount and redeemed at face value, with investors earning returns through price appreciation over time.
Considering this, Sebi has now partially tweaked the framework to allow issuers to offer zero-coupon debt securities with a fixed maturity and no structured obligations at the reduced face value of Rs 10,000.
Consequently, "the issuer shall be eligible to issue debt security at a reduced face value which may be either interest-bearing or zero interest-bearing security", Sebi said.
