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Published on: Sep 16, 2026

SEBI – Disclosure of Material Impact of COVID-19 by Listed Entities

On 20th May 2020, the Securities and Exchange Board of India (SEBI) issued an important advisory to listed entities. This advisory mandates the disclosure of the financial impact of COVID-19 on the entity's operations, facilitating transparency and clarity in the market.

The primary goal of the advisory is to address market distortions resulting from gaps in information about company operations. Disclosing the material impact of COVID-19 greatly assists stakeholders and investors in assessing the business disruption's extent and potential recovery. For more information, consider reviewing related project exports insights.

Disclosure Requirements under LODR Regulations

The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, commonly referred to as LODR regulations, specify disclosure provisions for material events impacting an entity's performance. Details are as follows:

  • Regulation 30(3)— Requires disclosing material information due to natural calamities or force majeure events, such as strikes or lockdowns, affecting operations in any unit of the listed entity. Disclosure must occur within 24 hours or the delay must be explained.
  • Regulation 51(1)— Specifically requires prompt distribution of any performance-impacting information for non-convertible instruments.

While some entities disclosed shutdowns and safety measures, few have detailed COVID-19's financial impact. Thus, SEBI encourages entities to evaluate and communicate COVID-19's effects on their business, both qualitatively and quantitatively, where possible. For further guidance on business evaluations, access the annual return filing for private limited companies.

Suggestive List of Disclosures

According to advisory no. SEBI/HO/CFD/CMD1/CIR/P/2020/84 from 20th May 2020, SEBI provides an illustrative list of disclosures for consideration:

  • Impact of COVID-19 on the business of the listed entity.
  • Effects on areas such as:
    • Liquidity position
    • Capital and financial resources
    • Product/service demand
    • Supply chain
    • Internal financial reporting and control
    • Ability to service debts
    • Significant impact from contract non-fulfillment
  • Future implications of COVID-19 and operational recovery schedules.
  • Steps for safeguarding smooth operations.
  • Additional material updates on business status.

For more insights into maintaining operational flow, consider the applicability of GST and ITC availability. Furthermore, entities interested in enhancing sector resilience may refer to sector-specific funding for startups.

For compliance with disclosure regulations, companies may also want to explore ITR filing options and trademark registration to ensure complete adherence to statutory requirements.

Entities preparing their financial projections may benefit from reviewing the ITR 2 resources and engaging with foreign investor-specific tax provisions.

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Frequently Asked Questions

Common questions about SEBI Disclosure of Material Impact by Listed Entities India.

The advisory aims to ensure that listed entities disclose the material impact of COVID-19 on their operations, financials, and performance. This will help resolve information gaps and enable stakeholders and investors to assess the extent of disruption caused to the company's business due to the pandemic.
Under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, listed entities are required to disclose material information on events like natural calamities or force majeure that result in disruption of operations (Regulation 30(3)). For non-convertible instruments, prompt disclosure of information affecting performance or operations is mandated (Regulation 51(1)).
While many listed entities have disclosed the fact of shutdowns due to the COVID-19 lockdown and measures taken for sanitation and safety, only a few have disclosed the financial impact of the pandemic on their business.
SEBI has provided an illustrative list of disclosures that listed entities may consider, including the impact of COVID-19 on their business, liquidity position, capital resources, demand for products/services, supply chain, financial reporting and controls, debt servicing ability, contractual obligations, future operational implications, restart schedules, and steps taken to ensure smooth functioning.
Disclosing the material impact of COVID-19 is crucial for listed entities to provide transparency and enable stakeholders and investors to assess the extent of disruption caused to the company's business. It helps prevent information gaps and potential market distortions.
Failure to disclose the material impact of COVID-19 on operations, financials, and performance can lead to information gaps and market distortions, as stakeholders and investors may not have a clear understanding of the company's situation and the extent of disruption caused by the pandemic.
Listed entities should carefully evaluate and disclose the qualitative and quantitative impact of COVID-19 on their business, following SEBI's suggestive list of disclosures. They should provide accurate and timely information to maintain transparency and ensure compliance with regulatory requirements.
Disclosing the impact on liquidity position and capital resources is important as it provides insights into the company's ability to meet its financial obligations and sustain operations during the COVID-19 disruption. This information is crucial for stakeholders and investors to assess the financial health of the entity.
By disclosing the impact of COVID-19 on the supply chain and demand for products/services, listed entities can provide stakeholders and investors with a better understanding of the operational challenges faced and potential revenue implications. This information can help assess the company's resilience and ability to navigate the crisis.
Disclosing the steps taken to ensure smooth functioning of operations is essential as it demonstrates the company's preparedness and efforts to mitigate the impact of COVID-19 on its business. This information can instill confidence in stakeholders and investors regarding the entity's ability to adapt and recover from the disruption caused by the pandemic.