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Home / SEBI & Capital Markets / Merchant Banker Registration & Valuation Rules
Last updated: 2 October 2026
SEBI’s amended Merchant Bankers Regulations, effective January 2026, created two categories with higher net worth and narrowed the activities merchant bankers may carry on. Expertvuw’s team supports applicants with registration and helps companies identify the right valuer for each valuation purpose.
Merchant bankers manage public issues, rights issues, open offers, buy-backs, delisting offers and similar transactions under SEBI regulations. The SEBI (Merchant Bankers) Regulations, 1992 were substantially amended by a notification in December 2025, effective 3 January 2026.
There are now two categories. Category I merchant bankers need a net worth of ₹50 crore and can undertake all permitted activities, including mainboard equity issues. Category II merchant bankers need a net worth of ₹10 crore and can undertake all activities except mainboard equity issues. Minimum revenue tests and liquid net worth requirements also apply, and existing merchant bankers have a phased timeline to meet the new thresholds.
The amendments also restrict merchant bankers to activities permitted under SEBI regulations, with other activities to be moved out. Companies that have relied on merchant bankers for valuations under other laws — such as FEMA pricing or income-tax rules — should confirm, for each purpose, which valuers are currently eligible and whether the report needs to come from a separate entity.
Basis: SEBI (Merchant Bankers) Regulations, 1992, as amended by notification of December 2025 (effective 3 January 2026); FEM (Non-debt Instruments) Rules, 2019; Income-tax Rules on valuation; Companies (Registered Valuers and Valuation) Rules, 2017. Last updated: 27 September 2026.
Amended regulations effective from 3 January 2026.
Net worth ₹50 crore; all permitted activities including mainboard issues.
Net worth ₹10 crore; all activities except mainboard equity issues.
Minimum revenue from permitted activities over three years.
Existing merchant bankers have a phased timeline to meet new thresholds.
Check eligible valuers for each law, as merchant bankers' activities are now narrower.
The new rules affect both merchant bankers and their clients.
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This connects with these services.
Valuation for tax, FEMA and Companies Act.
SME platform listing.
Rights issues by listed companies.
Stock broker registration.
Check category, net worth and revenue.
Compile application and policies.
File with SEBI with fees.
Respond to SEBI observations.
Receive the certificate.
Set up ongoing compliance.
Registered merchant bankers have continuing duties.
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Category I (net worth ₹50 crore, all permitted activities) and Category II (net worth ₹10 crore, all except mainboard equity issues), effective January 2026.
From 3 January 2026, following the December 2025 notification.
Existing merchant bankers have a phased timeline to meet the new net worth thresholds.
The amendments narrow merchant bankers to SEBI-permitted activities. Companies should confirm the eligible valuer for each valuation purpose under the relevant law.
A SEBI-registered merchant banker; mainboard equity issues require a Category I merchant banker.
ACS – Director, Expertvuw Management Pvt Ltd
SEBI applications and filings are prepared by Expertvuw’s team. Certificates, audits and due diligence that SEBI regulations reserve for practising professionals or registered intermediaries are provided by independent registered professionals, and representation before SEBI or SAT is made by advocates or authorised professionals.