The role of a Research Analyst has become increasingly vital in India’s burgeoning financial sector. This guide aims to provide you with all the necessary information, from understanding what a Research Analyst is to the specific criteria required for registration with SEBI (Securities and Exchange Board of India).
Becoming a Research Analyst in India is a process that requires specialized educational qualifications, certifications, and adherence to regulatory guidelines. This article elaborates on the meaning of a Research Analyst, the eligibility criteria, the process of registering with SEBI, and the required documentation. Let’s dive into the nitty-gritty.
i. What is a Research Analyst?
Research Analyst means a person who is responsible for
a. Preparation or publication of the content of the research report; or
b. Providing research report; or
c. Making “buy/sell/hell” recommendations; or
d. Giving price target; or
e. Offering an opinion concerning public offer,
With respect to securities that are listed or to be listed in a stock exchange.
ii. What is a Research Report?
The term encompasses all forms of written or electronic communication, such as research analysis, research recommendations, or opinions regarding securities or public offerings that provide a foundation for making investment decisions.
iii. What is a Proxy Adviser?
The term refers to a person who advises an institutional investor or shareholder of a company, in relation to exercise of their rights in the company including recommendations on public offer or voting recommendation on agenda items in a meeting.
A person desirous to get registered as a Research Analyst under SEBI (RA) Regulation 2014, shall meet the following two main criteria at all times:
A. Qualification and certification requirements
B. Capital adequacy requirements
a. The applicant shall have a professional qualification or post-graduate degree or post graduate diploma in finance, accountancy, business management, commerce, economics, capital market, financial services or markets, from a university or an institution recognized by the central government or any state government or a recognised foreign university or institution or association, or
b. professional qualification or post-graduate degree or post graduate diploma which is accredited by All Indian Council for Technical Education, National Assessment and Accreditation Council or National Board of Accreditation or any other council/board/body set up under an Act of Parliament in India for the purpose, or
c. a professional qualification by completing a Post Graduate Program in the Securities Market (Research Analysis) from NISM of a duration not less than one year, or
d. a graduate in any discipline with an experience of at least 5 years (five years) in activities relating to financial products or markets or securities or fund or asset or portfolio management.
a. The applicant shall have at all times, a NISM Certificate (Research Analyst XV).
i. An applicant desirous to get registered as a Research Analyst who is an individual (including proprietorship) or a Partnership Firm shall have net tangible assets of at least Rs 1 Lakh (Rs One Lakh).
“Net tangible assets” means the total assets less intangible assets (like trademarks, goodwill) less liabilities.
ii. An applicant desirous to get registered as a Research Analyst who is body corporate (Company) or a Limited Liability Partnership Firm (LLP) shall have a Networth of at least Rs 25 Lakh (Rs Twenty-Five Lakh).
Explanation ─ For the purposes of this regulation, “Networth” means the aggregate value of paid-up share capital plus free reserves (excluding reserves created out of revaluation) reduced by the aggregate value of accumulated losses.
An applicant desirous to get registered as a Research Analysts shall apply to SEBI for registration under SEBI (RA) Regulations 2014,
The Applicant shall make online application through the SEBI’s portal for intermediaries.
Application fee has to be paid along with submission of the application form. Once SEBI approves the application, you have to pay the registration fees.
Current fee structure:
|Individuals or Partnership Firms||5,000||10,000|
|Proxy Advisory Firms||5,000||10,000|
|Companies or LLPs||50,000||5,00,000|
The step-by-step process for registration of Research Analyst is given below:
Step 1: At first the applicant shall fulfill the qualification and certification requirements as mentioned above.
Step 2: The applicant shall ensure to have Net Tangible assets of Rs. 1 Lakh for Individual or Partnership Firm or Networth of Rs. 25 Lakh for Companies or LLPs.
Step 3: The applicant shall fill the details on SEBI Intermediaries Portal for self-registration on the portal. Once it is done the applicant shall make payment of application fee.
Step 4: Now the applicant shall make application in Form A on SEBI Intermediaries Portal to get registered as Research Analyst.
Step 5: The applicant shall reply to Clarifications raised by SEBI (if any).
Step 6: Communication from SEBI for either requesting more details or approval of application.
Step 7: Once the application is approved, the applicant shall make payment of registration fee.
Step 8: On receipt of fees, SEBI will issue of Certificate of Registration.
The certificate of registration granted shall be valid till it is suspended or cancelled by SEBI.
a. Proof of Identity
b. Proof of address
c. Proof of qualification (Degree certificates, NISM exam certificates)
d. Experience Certificate in case of graduates (e.g., Insurance agency license, MF ARN card, etc.)
e. Net worth certificates from a Chartered Accountant.
f. Income Tax Returns for the last 3 years (Mandatory for Individual)
i. Declaration of Compliance to Relevant Clauses of Chapter III of the Regulations.
ii. Declaration of Compliance with Schedule II of SEBI Regulations, specifying the four criteria.
iii. Declaration of Compliance with Regulation 7(1) of Research Analysts Regulations 2014.
iv. Declaration of Compliance with Regulation 7(2) of Research Analysts Regulations 2014.
v. Declaration of Necessary Infrastructure Availability.
h. Details regarding infrastructure availability for research analyst services, including supporting documents. This includes information about office space, furniture, fixtures, software configuration, hardware configuration, software support, hardware support, and other relevant infrastructure facilities.
i. Business plan and details of current activities.
j. Other documents as may be required during the course of registration.
Conclusion: Becoming a Research Analyst in India is a rigorous yet rewarding process. It requires a blend of academic qualifications, certifications, and strict compliance with SEBI regulations. While the journey may seem complex, proper understanding and adherence to the guidelines make it a straightforward process. Whether you’re fresh out of university or an experienced professional, following this comprehensive guide will put you on the right path.
Hope this article gives you clarity on the requirements for registration as a Research Analyst. In case you have any queries or are looking for any professional assistance to make an application, you may write to me at email@example.com