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Below the Comment on SEBI amendment to share based employee benefit regulation by Makarand Joshi, founder partner MMJC associate a corporate compliance firm

SEBI’s latest amendment to the SBEB and Sweat Equity Regulations marks a progressive shift in India’s public markets. With companies getting listed rising from 272 in FY24 to 320 in FY25, the new rule enables promoters to continue holding stock options post-listing—aligning India with global best practices. This move allows promoters to participate in the growth story after IPO, instilling confidence among retail investors through visible, long-term promoter “skin in the game”. By allowing compensation through options, companies save cash while incentivizing leadership continuity. However, to fully unlock the benefit for IPO-bound promoters, a corresponding change in the Companies Act is critical.

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