Share-based benefit rules don't apply to notional issues: Sebi

Market regulator Sebi has said the notional stock appreciation right (SAR) unit issued by companies to its promoters or employees does not qualify for share-based employee benefit regulations.

Under the regulations, the scheme should actually involve "dealing in or subscribing to or purchasing securities of the company directly or indirectly".

The Securities and Exchange Board of India (Sebi) has conveyed its views in response to an 'informal guidance' sought by Mindtree on an employee benefit scheme, Phantom Stock Scheme, introduced by the company.

In August 2013, the stock appreciation rights scheme was introduced by Mindtree pursuant to which SAR units (Phantom Stock) were granted to six employees, who are also promoters of the company. 

The scheme was later renamed as Phantom Stock Program.

The company has issued notional SAR units at a pre- -determined grant price and the promoters are entitled to get cash payment for appreciation in the share price over the grant price for the awarded units, based on realisation of the specified revenue targets.

In its response, Sebi said share-based employee benefit regulations 'may not apply to the instant Phantom Stock Scheme' as it does not involve any actual purchase or sale of the equity shares of Mindtree.

In a separate case, the market watchdog said the managing director (MD) benefits scheme introduced by Saregama India does not qualify for the 'share-based employee benefit regulation' as it does not involve any actual purchase or sale of shares of the company. 

Sensex breaks 4-day losing streak; recovers 104 points.

 The market benchmark Sensex on Wednesday recovered from over one-month lows by rising 104.20 points to 27,563.43 as investors preferred to create positions in IT, capital goods and auto stocks ahead of F&O expiry tomorrow.

BSE Sensex managed to end four-day losing streak, in which it had lost close of 1,050 points, as market found immediate support in the continuing fall in crude prices.

Oil fell for a sixth day today to USD 53.06 per barrel.

Moreover, experts hoping that an imminent rate hike by the US Fed this year will have a minimal impact on emerging markets, including India, supported the upside.

"This is evident from the hike in global bond yields, the appreciation of the dollar and the sharp fall in commodities," said Vinod Nair, Head-Fundamental Research at Geojit BNP Paribas Financial Services.

Sill, some investors remained cautious ahead of the US Fed FOMC meet outcome which is expected to come tonight.

The BSE 30-share barometer resumed higher and improved further to a high of 27,609.29 before falling back to a low of 27,470.09. 

It finally, closed at 27,563.43 -- a gain of 104.20 points or 0.38 percent.

Among the 30-Sensex constituents, 20 shares ended higher.

The broad-based NSE Nifty also ended higher by 38.05 points or 0.46 percent to 8,375.05. Intra-day, it shuttled between 8,381.50 and 8,338.45.

Covering-up of outstanding short positions by traders in view of tomorrow's July's month expiry in the derivatives segment too supported the recovery.

Asian stocks closed mixed with upward bias. Shanghai index rebounded 3.44 percent after three sessions of losses.

European markets were too higher in late morning deals.

Back home, stocks of Tata Steel and Hindalco were back in demand and rose up to 0.95 percent as prices of industrial metals recovered in global markets.

Other Sensex gainers were Tata Motors, Lupin, BHEL, Maruti Suzuki, Hero MotoCorp, L&T, Bharti Airtel, ICICI Bank, HDFC, Sun Pharma, Vedanta, Cipla, Axis Bank, Bajaj Auto and ONGC.

Among BSE sectoral indices, Capital Goods gained the most by rising 1.89 percent, followed by IT 1.48 percent, auto 1.39 percent, teck 1.34 percent and Realty 1.22 percent.

Meanwhile, Foreign Portfolio Investors (FPIs) sold shares worth a net Rs 1,375.66 crore yesterday, as per provisional data.