The SAST Regulation by SEBI, were mainly added to regulate the acquisition of shares and voting rights in Public Listed Companies in India. This regulation by SEBI (Indian regulator for financial markets) is pertinent to asset management companies (or mutual funds (MF)) which hold, and trade equity of various companies listed in the equity market like BSE, NSE etc.
Just as regulations related to most financial services, this regulation is quite comprehensive. It covers direct acquisition of shares, indirect acquisition of shares, context of voting rights, offers, process when shares are de-listed, etc. The client’s compliance team proposed automation to make the process optimal. Since SheetKraft was already being used as automation platform for this client, SAST was taken as another project by SheetKraft.
As per the SEBI guidelines, every security must be monitored closely to keep a tab on current holding percentage for every issuer/company.
|>5%||Notification and document sent to SEBI|
|+/-2% post 5% increase||Continuously monitored and notification and document sent to SEBI|
|<5%||Compliant with SEBI, no action required|
Before Sheetkraft, team had to continuously monitor the holding percentage. This required a lot of manual work and involved greater risk of missing out on a trigger. If a trigger is missed, the mutual fund company becomes non-compliant with SEBI regulations Each time, there is an increase of 2%, an email must be sent. The process involves continuous monitoring. It therefore demands a lot of time and effort. Moreover, due to the massive amount of data, the manual process had a high error rate making the process quite inefficient.
Before SheetKraft’s SAST report generation solution was implemented, the process involved using many productive hours of an employee. Post implementation of SheetKraft’s solution, there is no manual intervention required.