SEBI Simplifies Bond Pricing with Standard Yield Rules on RFQ Platform

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  • Last Updated on 19 May, 2025

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SEBI bond yield calculation

SEBI Circular: SEBI/HO/DDHS/DDHSPOD1/P/CIR/2025/72; Dated: 13.05.202

The Securities and Exchange Board of India (SEBI) has introduced significant updates to the bond market framework to bring more transparency and simplicity in pricing mechanisms, particularly on the Request for Quote (RFQ) platform.

1. Simplified Yield-to-Price Calculation

To streamline yield computations, SEBI has mandated that scheduled payment dates be used for calculating bond yields—without any day count adjustments. This change aims to remove complexities and create uniformity in how bond prices are derived, making it easier for market participants to understand and compare yields.

2. Mandatory Disclosure of Cash Flow Schedules

Under the new framework, issuers of debt securities are now required to –

  • Disclose detailed cash flow schedules (including principal and interest payments)
  • Ensure updates to these schedules are made in the Corporate Bond Database maintained by the depositories
  • Submit or update this information within one working day of issuance or any change

This will enable investors and analysts to better assess risk and return profiles of bond instruments.

3. Applicability to Existing and New Securities

The revised rules are applicable to both newly issued and existing debt securities. Issuers must ensure compliance by August 18, 2025, giving them a clear timeline to adapt their systems and disclosures.

4. Objective – Transparency, Efficiency & Investor Protection

SEBI’s move is aimed at –

  • Enhancing transparency in the debt market
  • Simplifying operations for all stakeholders
  • Improving investor protection through timely and accurate disclosures

By standardising the approach to yield calculation and cash flow reporting, SEBI seeks to foster greater trust and participation in the corporate bond market.

Click Here To Read The Full Circular

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied