NISM Series III-A · Chapter 18: SEBI (Research Analyst) Regulations, 2014

L1 · Foundation

SEBI (Research Analyst) Regulations, 2014

Who is a research analyst and what research services are; what counts as a research report and the nine communications excluded from the definition; internal policies and the independence of research; the trading window of 30 days before and 5 days after; limitations on publication, public appearance and conduct; disclosures on financial interest, 1 per cent ownership and material conflict; third-party reports, artificial intelligence and the functional website; general responsibilities; the eight records and their five-year preservation with an annual audit; the compliance officer or independent professional; and the Anirudh Sethi case.

20 min read · Worth 2% of the paper · Written from pages 346–353 of the official NISM workbook · Updated 17 September 2026

What this chapter covers

This chapter carries 2 per cent of the III-A examination.

LEARNING OBJECTIVES: After studying this chapter, you should know about: Management of Conflict of Interest and Disclosure requirements · General Responsibility · Different Records /Reports to be maintained by Research Analyst

18.1 Introduction

SEBI (Research Analysts) Regulations, 2014 put in place a framework to register and regulate research analysts.

"Research analyst" means a person who, for consideration, is engaged in the business of providing research services and includes a part-time research analyst.

Two elements — for consideration, and in the business of research services — and the definition expressly reaches a part-time research analyst.

"Research Services" means the following services provided by a research analyst:

i. preparation or publication of the research report or content of the research report.
ii. providing or issuing a research report or research analysis.
iii. making 'buy/sell/hold' recommendation.
iv. giving price target or stop loss target.
v. offering an opinion concerning public offer.
vi. recommending model portfolio.
vii. providing trading calls.
viii. any other service of a similar nature or character, with respect to securities that are listed or proposed to be listed in a stock exchange, whether or not any such person has the job title of 'research analyst' to the clients or other persons or a group of persons or the general public.

Limb (iii) is the first review question — it is the research analyst who makes buy/sell recommendations.

And the closing words of limb (viii) matter most. The Regulations apply whether or not any such person has the job title of 'research analyst', and whether the audience is the clients or other persons or a group of persons or the general public.

Function, not job title — which is exactly what caught Anirudh Sethi.

Research Analysts are required to be registered with SEBI.

What is a research report — and what is not

"Research Report" [means] any written or electronic communication that includes research analysis or research recommendation or an opinion concerning securities or public offer, providing a basis for investment decision.

Providing a basis for investment decision is the operative idea, and the definition then excludes nine things:

(i) comments on general trends in the securities market.
(ii) discussions on the broad-based indices.
(iii) commentaries on economic, political or market conditions.
(iv) periodic reports or other communications prepared for unitholders of a mutual fund or alternative investment fund or clients of portfolio managers and investment advisers.
(v) internal communications that are not given to current or prospective clients.
(vi) communications that constitute offer documents or prospectus that are circulated as per regulations made by SEBI.
(vii) statistical summaries of financial data of the companies.
(viii) technical analysis relating to the demand and supply in a sector or the index.
(ix) any other communication which SEBI may specify from time to time.

Notice the pattern. What is excluded is either general (market trends, indices, economic commentary, sector or index technicals), already regulated elsewhere (mutual fund and PMS reports, offer documents), not published (internal communications), or merely factual (statistical summaries).

What remains is stock-specific opinion aimed at an investment decision.

18.2 Conflict of interest and disclosure

Internal policies — Regulation 15

Research analyst or research entity shall have written internal policies and control procedures governing the dealing and trading by any research analyst for:

(i) addressing actual or potential conflict of interest arising from such dealings or trading of securities of the subject company.
(ii) promoting objective and reliable research that reflects the unbiased view of the research analyst.
(iii) preventing the use of research reports or research analysis to manipulate the securities market.

And structurally: research analysts or research entities shall have in place appropriate mechanisms to ensure the independence of their research activities from their other business activities.

Fees — Regulation 15A. The Research Analyst will be entitled to charge fees for providing research services to a client, including an accredited investor, in the manner as specified by SEBI.

Limitations on trading — Regulation 16

Personal trading activities of the individuals employed as research analysts by the research entity shall be monitored, recorded, and, wherever necessary, shall be subject to formal approval.

And the blackout: independent research analysts, part-time research analysts, individuals employed as research analysts by research entities or their associates, shall not deal or trade in securities that the research analyst recommends or follows within 30 days before and 5 days after publication of a research report.

Thirty days before, five days after.

Two further bars. They shall not deal or trade directly or indirectly in securities that he reviews in a manner contrary to his given recommendation. And they shall also not purchase or receive securities of the issuer before the issuer's initial public offering, if the issuer is principally engaged in the same types of business as companies that the research analyst follows or recommends.

No trading against your own call, and no pre-IPO stock in your own coverage sector.

Limitations on publication and conduct — Regulation 18

Research analyst or Research entity shall not provide any promise or assurance of favourable review in its research report to a company or industry or sector, or group of companies, or business group as consideration to commence or influence a business relationship or for the receipt of compensation or other benefits.

Research is not currency for winning business.

Research entity shall ensure that the individuals employed as research analysts are separate from other employees who are performing sales, trading, dealing, corporate finance advisory, or any other activity that may affect the independence of its research report. Feedback from sales or trading personnel of the brokerage division to ascertain the impact of the research report, however, is allowed.

Separation, with one narrow permission — feedback to ascertain the impact of the research report.

Research analysts... shall not participate in business activities designed to solicit investment banking or merchant banking, or brokerage services business, such as sales pitches and deal roadshows.

Research analysts... shall not engage in any communication with a current or prospective client in the presence of personnel from investment banking or merchant banking, or brokerage services divisions, or company management about an investment banking service transaction.

Not even in the room — the analyst must not be present where an investment banking transaction is discussed with a client.

Disclosures — Regulations 19 to 22

Regulations 19, 19A, 20, 21, and 22 deal with Disclosure in research reports, functional website, Contents of the research report, recommendations in public media, and distribution of research reports, respectively.

Research analyst or research entity shall disclose the following in the research report and public appearance with regard to ownership and material conflict of interest:

a) whether they or its associate or relative has any financial interest in the subject company and the nature of such financial interest.
b) whether they have actual/beneficial ownership of 1% or more securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or the date of public appearance.
c) whether they or its associate or relative has any material conflict of interest at the time of publication of the research report or at the time of public appearance.

One per cent, measured at the end of the month immediately preceding.

No selective release: research report shall not be made available selectively to internal trading personnel or a particular client or class of clients in advance of other clients who are entitled to receive the research report.

Third-party reports: an analyst or entity that distributes any third-party research report shall review the third-party research report for any untrue statement of a material fact or any false or misleading information. They also need to disclose any material conflict of interest of such third-party research provider or address that directs the recipient to the relevant disclosure.

Distributing someone else's report does not outsource responsibility for it.

Artificial intelligence: a research analyst or research entity shall disclose to the client the extent of use of Artificial Intelligence tools in providing research services.

Website: a Research analyst or research entity shall maintain a functional website containing such details as may be specified by SEBI.

18.3 General responsibilities — Regulation 24

Research analyst or research entity shall maintain an arms-length relationship between its research activity and other activities.

Research analysts or research entities shall abide by the Code of Conduct.

In case of a change in control of the research analyst or research entity, prior approval from SEBI shall be taken.

Research analysts or research entities shall furnish SEBI information and reports as may be specified by SEBI from time to time.

It shall be the responsibility of the research analyst or research entity to ensure that its employees or partners, as may be applicable, comply with the certification and qualification requirements at all times (Regulation 7).

Research analyst or research entity shall disclose to the client the terms and conditions as may be specified by SEBI and take consent of the client on such terms and conditions in such manner as may be specified by SEBI.

And on artificial intelligence the responsibility is absolute: a research analyst or research entity who uses Artificial Intelligence tools, irrespective of the scale and scenario of adoption of such tools, for servicing its clients shall be solely responsible for the security, confidentiality and integrity of the client data, use of any other information or data for research services, research services based on output of Artificial Intelligence tools and compliance with any law for the time being in force.

Solely responsible, irrespective of the scale and scenario — the tool is no defence.

Research analyst or research entity engaged in providing a model portfolio shall abide by the guidelines issued by SEBI from time to time.

A research analyst shall ensure compliance with the Investor Charter specified by SEBI from time to time.

18.4 Maintenance of records

Research analyst or research entity shall maintain the following records:

(i) research report duly signed and dated.
(ii) research recommendation provided.
(iii) rationale for arriving at research recommendation.
(iv) record of public appearance.
(v) Know Your Client records of the fee-paying client.
(vi) a register or record containing a list of the clients along with the client's PAN, the date and nature of the research service, details of the products/securities for which the research service was provided, and the fee/consideration, if any, charged/received for such research service.
(vii) records of communication, including emails, call recordings, etc., with all clients, including prospective clients, in such manner as may be specified.
(viii) the terms and conditions of research services disclosed to the clients and the consent of the client thereon.

Eight heads. Note that limb (iii) — rationale for arriving at research recommendation — is what makes a recommendation auditable afterwards, and that limb (vii) reaches prospective clients too.

How long, and in what form. All records shall be maintained either in physical or electronic form and preserved for a minimum period of five years. Further, where records are required to be duly signed and are maintained in electronic form, such records shall be digitally signed.

Five years — the second review question. Shorter than the eight years that bind stockbrokers, merchant bankers, bankers to an issue, depository participants and RTAs.

Audit. Research analyst or research entity shall conduct an annual audit in respect of compliance with these regulations by a member of the Institute of Chartered Accountants of India or the Institute of Company Secretaries of India, or the Institute of Cost Accountants of India, and submit the report of the same in such manner as may be specified by SEBI.

Annual, not quarterly or half-yearly — the fourth review question.

Note on the third review question. It asks which type of records the analyst must maintain, offering Client's KYC details, Risk assessment of clients, Rationale for arriving at research recommendation and Register of clients which the firm deals with. In fact three of these appear in the statutory list — KYC of the fee-paying client, the register or record containing a list of the clients along with the client's PAN, and the rationale for arriving at research recommendation. The one that does not appear is risk assessment of clients, which belongs to the investment adviser regime, where suitability and risk profiling are central. The intended answer is the rationale, but answer according to how the option set is framed in the paper, and remember that risk assessment is the odd one out.

18.5 and 18.6 Compliance officer

Research analyst or research entity, which is a body corporate or limited liability partnership firm, shall appoint a compliance officer who shall be responsible for monitoring the compliance of the provisions of the Act, these regulations, and circulars issued by the Board.

Regulation 26 gives a choice. A non-individual research analyst or research entity shall appoint either:

(i) a compliance officer.
(ii) an independent professional who is a member of the Institute of Chartered Accountants of India or the Institute of Company Secretaries of India or the Institute of Cost Accountants of India or a member of any other professional body as may be specified by the Board, provided that such a professional holds a relevant certification from NISM, as specified by the Board.

An outsider is permitted — but only a qualified professional who holds a relevant certification from NISM.

And where the outsider route is used, accountability stays inside. Where independent professional... is appointed for monitoring compliance, the principal officer shall submit an undertaking to the Board or the body or body corporate recognised under regulation 14 of these regulations to the effect that principal officer shall be responsible for monitoring the compliance in respect of the requirements of the Act, regulations, notifications, guidelines, instructions issued by the Board.

The compliance function may be outsourced; the responsibility may not.

Further, Regulations 26A, 26B and 26C describe the dispute resolution pertaining to research analyst or research entity and its client, redressal of investor grievances and client level segregation of research services and distribution activities respectively.

And on past performance: SEBI has enabled Research Analysts (RAs) to share past performance data with clients for the period prior to the operationalization of PaRRVA — the Past Risk and Return Verification Agency.

Case 18.1 — SEBI v Anirudh Sethi

The facts. SEBI passed an interim order of 2016 against Anirudh Sethi and his extant business "stock market navigator" restraining them from giving investment advice to clients, including any recommendations containing company-specific news, amounts to a violation of SEBI (PFUTP) Regulations. Further, the order directed notice to cease from acting as a research analyst and remove all material published from the public domain.

The findings. He was providing a subscription-based service providing technical analysis of stock, F&O, Commodities, Currencies, etc., acting as an investment adviser and research analyst through his website.

SEBI found that:

He was offering stock-specific tips and recommendations and technical calls which prima facie fall under the definition of the research analyst of RA regulations.
He was offering buy/sell recommendations and giving price targets with respect to securities listed on the stock exchange.
He made a research report to the public, which is a violation of RA regulations.
He did not possess a certificate of registration as a research analyst.

Which is exactly why the definition ends with "whether or not any such person has the job title of 'research analyst'." Calling the service something else did not take it outside the Regulations.

The order.

Anirudh Sethi shall refund money received from its clients as fees/profit sharing/compensation in respect of unregistered research analyst services.

Anirudh Sethi not to divert any funds raised from investors except for the purpose of refund to clients. Banks and Depositories directed that no debit shall be made without the permission of SEBI.

**He is directed not to directly or indirectly access the securities market and is prohibited from buying, selling, or otherwise dealing in the securities market, directly or indirectly, in manner whatsoever till the expiry of 4 years from the date of the order (March 16, 2018), and is restrained from associating with any listed public company and any public company or registered intermediary with SEBI till the expiry of 4 years from the date of refund.

Note the two different starting points — four years from the order for the market ban, and four years from the refund for the association ban, which gives him an incentive to refund quickly.

And finally: Anirudh Sethi shall not undertake either directly or indirectly, research analyst services without obtaining a certificate of registration.

The chapter's review questions confirm four things:

The research analyst is primarily responsible for making buy/sell recommendations.
Research reports and recommendations are preserved for a minimum of 5 years.
The records include the rationale for arriving at research recommendation. Risk assessment of clients does not appear in the list.
It is True that a research analyst must conduct an annual audit of compliance.

Think of it like this

Job title is irrelevant — what makes someone a research analyst

The definition is drafted to catch a function, not a designation.

"Research analyst" means a person who, for consideration, is engaged in the business of providing research services and includes a part-time research analyst.

And "research services" runs to eight limbs — preparation or publication of the research report · providing or issuing a research report or research analysis · making 'buy/sell/hold' recommendation · giving price target or stop loss target · offering an opinion concerning public offer · recommending model portfolio · providing trading calls · and any other service of a similar nature or character.

Then the words that decide cases: all of this with respect to securities that are listed or proposed to be listed in a stock exchange, whether or not any such person has the job title of 'research analyst' to the clients or other persons or a group of persons or the general public.

Three consequences.

The title does not matter. A "market navigator", a "tips service", a "technical desk" — if it makes buy/sell calls or gives price targets on listed securities for consideration, it is providing research services.

The audience does not matter. The clients or other persons or a group of persons or the general public — a public website is as much within the definition as a subscriber list.

Part-time does not matter. The definition includes a part-time research analyst.

Anirudh Sethi is the illustration. He was providing a subscription-based service providing technical analysis of stock, F&O, Commodities, Currencies, etc., offering stock-specific tips and recommendations and technical calls which prima facie fall under the definition of the research analyst of RA regulations, and offering buy/sell recommendations and giving price targets with respect to securities listed on the stock exchange — but did not possess a certificate of registration as a research analyst.

And the requirement is plain: Research Analysts are required to be registered with SEBI.

Nine things that are not research reports

The definition of a research report is short, and the exclusions do most of the work.

Then nine exclusions, which fall into four families.

Too general to be a basis for a decision: (i) comments on general trends in the securities market · (ii) discussions on the broad-based indices · (iii) commentaries on economic, political or market conditions · (viii) technical analysis relating to the demand and supply in a sector or the index.

Note how far (viii) goes — technical analysis of a sector or the index is excluded; technical analysis of a stock is not, which is why Anirudh Sethi's technical calls on individual securities fell squarely within the definition.

Already regulated elsewhere: (iv) periodic reports or other communications prepared for unitholders of a mutual fund or alternative investment fund or clients of portfolio managers and investment advisers · (vi) communications that constitute offer documents or prospectus that are circulated as per regulations made by SEBI.

Not published at all: (v) internal communications that are not given to current or prospective clients.

Merely factual: (vii) statistical summaries of financial data of the companies.

Plus a residual power: (ix) any other communication which SEBI may specify from time to time.

What survives the exclusions is the thing worth regulating — a stock-specific opinion or recommendation, offered as a basis for investment decision.

**Which is why the records must include the rationale for arriving at research recommendation and the research report duly signed and dated — an opinion offered as a basis for someone else's money should be capable of being examined afterwards.

Thirty days before, five days after

The trading restrictions exist because an analyst knows what his report will say before anyone else does.

Independent research analysts, part-time research analysts, individuals employed as research analysts by research entities or their associates, shall not deal or trade in securities that the research analyst recommends or follows within 30 days before and 5 days after publication of a research report.

Thirty days before stops accumulation ahead of a favourable report. Five days after stops selling into the demand the report creates.

And note the coverage — it binds independent research analysts, part-time research analysts, individuals employed as research analysts by research entities or their associates, and applies to securities that the research analyst recommends or follows, not only those he has just written about.

Two further rules complete the fence.

They shall not deal or trade directly or indirectly in securities that he reviews in a manner contrary to his given recommendation.

Selling what you told clients to buy — outside the window as much as inside it.

They shall also not purchase or receive securities of the issuer before the issuer's initial public offering, if the issuer is principally engaged in the same types of business as companies that the research analyst follows or recommends.

No pre-IPO stock in your own sector, because coverage of that sector could later be shaped by the holding.

And the whole of it is supervised, not merely stated: personal trading activities of the individuals employed as research analysts by the research entity shall be monitored, recorded, and, wherever necessary, shall be subject to formal approval.

Monitored, recorded, and sometimes pre-approved.

Behind them sit the internal policies required by Regulation 15 — addressing actual or potential conflict of interest arising from such dealings or trading of securities of the subject company; promoting objective and reliable research that reflects the unbiased view of the research analyst; and preventing the use of research reports or research analysis to manipulate the securities market.

Research kept apart from selling

Regulation 18 separates the analyst from everyone in the firm whose job is to win business.

One exception, narrowly drawn: feedback from sales or trading personnel of the brokerage division to ascertain the impact of the research report, however, is allowed.

Feedback about impact, after the fact — not input into the conclusion.

Then two prohibitions on the analyst's own activity.

The second is unusually specific about the setting — not merely the content of what is said, but who else is in the room. An analyst speaking about a banking transaction alongside the bankers and the company's management is no longer independent in the client's eyes, whatever he says.

And research must not be sold to issuers at all: the analyst or entity shall not provide any promise or assurance of favourable review in its research report to a company or industry or sector, or group of companies, or business group as consideration to commence or influence a business relationship or for the receipt of compensation or other benefits.

The structural requirements back this up. Entities must have appropriate mechanisms to ensure the independence of their research activities from their other business activities, and must maintain an arms-length relationship between its research activity and other activities.

Plus, under Regulation 26C, client level segregation of research services and distribution activities.

What Anirudh Sethi was ordered to do

The order is a good map of the remedies available against an unregistered intermediary.

Refund. Anirudh Sethi shall refund money received from its clients as fees/profit sharing/compensation in respect of unregistered research analyst services.

The fees go back — the service should never have been sold.

Ring-fencing. Anirudh Sethi not to divert any funds raised from investors except for the purpose of refund to clients. Banks and Depositories directed that no debit shall be made without the permission of SEBI.

The money is frozen except for refunds — a direction to the banks and depositories, not merely to him.

Market ban. He is directed not to directly or indirectly access the securities market and is prohibited from buying, selling, or otherwise dealing in the securities market, directly or indirectly, in manner whatsoever till the expiry of 4 years from the date of the order (March 16, 2018).

Association ban. He is restrained from associating with any listed public company and any public company or registered intermediary with SEBI till the expiry of 4 years from the date of refund.

Two clocks, deliberately different. The market ban runs from the order; the association ban runs from the refund — so the sooner investors are repaid, the sooner that clock starts.

And a permanent condition: Anirudh Sethi shall not undertake either directly or indirectly, research analyst services without obtaining a certificate of registration.

What he had done. A subscription-based service providing technical analysis of stock, F&O, Commodities, Currencies, acting as an investment adviser and research analyst through his website, offering buy/sell recommendations and giving price targets with respect to securities listed on the stock exchange, and making a research report to the public — all without a certificate of registration as a research analyst.

The earlier interim order of 2016 had already restrained him from advising and directed him to cease from acting as a research analyst and remove all material published from the public domain.

Key terms in this chapter

Anirudh Sethi case: SEBI passed an interim order in 2016 against Anirudh Sethi and his business restraining them from giving investment advice, including recommendations containing company-specific news, as a violation of the PFUTP Regulations, and directing them to cease acting as a research analyst and to remove all published material from the public domain. He was found to be running a subscription-based service providing technical analysis of stocks, F&O, commodities and currencies, acting as an investment adviser and research analyst through his website, offering stock-specific tips, buy and sell recommendations and price targets on listed securities and making a research report public, all without a certificate of registration as a research analyst. SEBI directed him to refund money received as fees, profit sharing or compensation for unregistered research analyst services; not to divert funds except for refunds, with banks and depositories directed to permit no debit without SEBI's permission; barred him from accessing the securities market for four years from the date of the order of 16 March 2018 and from associating with any listed or public company or registered intermediary for four years from the date of refund; and directed that he not undertake research analyst services without obtaining a certificate of registration.
Artificial intelligence and the functional website: A research analyst or entity must disclose to the client the extent of use of artificial intelligence tools in providing research services, and must maintain a functional website containing such details as SEBI specifies. One that uses AI tools, irrespective of the scale and scenario of adoption, for servicing clients is solely responsible for the security, confidentiality and integrity of client data, the use of any other information or data for research services, the research services based on the output of those tools, and compliance with any law in force.
Compliance officer of a research analyst: A research analyst or entity that is a body corporate or limited liability partnership must appoint a compliance officer responsible for monitoring compliance with the Act, the Regulations and SEBI circulars. Under regulation 26 a non-individual research analyst or entity may appoint either a compliance officer or an independent professional who is a member of the ICAI, ICSI or ICMAI or of another professional body specified by SEBI, provided that professional holds the relevant NISM certification. Where an independent professional is appointed, the principal officer must give an undertaking to SEBI, or to the body recognised under regulation 14, that he will be responsible for monitoring compliance with the requirements of the Act, regulations, notifications, guidelines and instructions issued by SEBI. Regulations 26A, 26B and 26C deal with dispute resolution between the analyst and its client, redressal of investor grievances, and client level segregation of research services and distribution activities.
Disclosures in research reports and public appearances: A research analyst or entity must disclose, in the research report and in public appearances, whether it or its associate or relative has any financial interest in the subject company and the nature of that interest; whether it has actual or beneficial ownership of one per cent or more of the securities of the subject company at the end of the month immediately preceding the date of publication of the report or the date of the public appearance; and whether it or its associate or relative has any material conflict of interest at the time of publication or of the public appearance.
Distribution of research reports: A research report may not be made available selectively to internal trading personnel or to a particular client or class of clients in advance of other clients entitled to receive it. A research analyst or entity distributing any third-party research report must review it for any untrue statement of a material fact or any false or misleading information, and must disclose any material conflict of interest of the third-party research provider or an address directing the recipient to the relevant disclosure.
Fees for research services: Under regulation 15A a research analyst is entitled to charge fees for providing research services to a client, including an accredited investor, in the manner specified by SEBI.
General responsibilities of a research analyst: To maintain an arms-length relationship between its research activity and other activities; abide by the code of conduct; obtain prior approval of SEBI for a change in control; furnish SEBI with information and reports as specified; ensure employees or partners comply with the certification and qualification requirements at all times; disclose to the client the terms and conditions specified by SEBI and take the client's consent to them; bear sole responsibility for matters connected with the use of artificial intelligence tools; abide by SEBI's guidelines where providing a model portfolio; and ensure compliance with the Investor Charter specified by SEBI.
Internal policies and independence of research: A research analyst or research entity must have written internal policies and control procedures governing dealing and trading by any research analyst, to address actual or potential conflicts of interest arising from dealing or trading in securities of the subject company, to promote objective and reliable research reflecting the unbiased view of the analyst, and to prevent the use of research reports or analysis to manipulate the securities market. They must also have appropriate mechanisms to ensure the independence of their research activities from their other business activities.
Limitations on publication and conduct: A research analyst or entity may not promise or assure a favourable review in its research report to a company, industry, sector, group of companies or business group as consideration to commence or influence a business relationship or for compensation or other benefits. A research entity must keep individuals employed as research analysts separate from employees performing sales, trading, dealing, corporate finance advisory or any activity affecting the independence of its research report, though feedback from sales or trading personnel of the brokerage division to ascertain the impact of the report is allowed. Analysts may not participate in business activities designed to solicit investment banking, merchant banking or brokerage services business, such as sales pitches and deal roadshows, and may not communicate with a current or prospective client about an investment banking service transaction in the presence of personnel from investment banking, merchant banking or brokerage services divisions or company management.
Limitations on trading by research analysts: Personal trading by individuals employed as research analysts by a research entity must be monitored, recorded and where necessary subject to formal approval. Independent research analysts, part-time research analysts, individuals employed as research analysts by research entities and their associates may not deal or trade in securities the analyst recommends or follows within thirty days before and five days after publication of a research report; may not deal or trade, directly or indirectly, in securities he reviews in a manner contrary to his given recommendation; and may not purchase or receive securities of an issuer before its initial public offering where the issuer is principally engaged in the same types of business as companies the analyst follows or recommends.
Past performance data: SEBI has enabled research analysts to share past performance data with clients for the period prior to the operationalisation of the Past Risk and Return Verification Agency.
Preservation of records and annual audit: All records must be maintained in physical or electronic form and preserved for a minimum period of five years, and records required to be duly signed which are kept electronically must be digitally signed. A research analyst or entity must conduct an annual audit of compliance with the Regulations by a member of the Institute of Chartered Accountants of India, the Institute of Company Secretaries of India or the Institute of Cost Accountants of India, and submit the report in the manner SEBI specifies.
Records to be maintained: The research report duly signed and dated; the research recommendation provided; the rationale for arriving at that recommendation; a record of public appearances; know your client records of the fee-paying client; a register or record listing clients with their PAN, the date and nature of the research service, details of the products or securities covered and the fee or consideration charged or received; records of communication including emails and call recordings with all clients including prospective clients; and the terms and conditions of research services disclosed to clients with the client's consent to them.
Research analyst: A person who, for consideration, is engaged in the business of providing research services, expressly including a part-time research analyst. Research analysts are required to be registered with SEBI under the SEBI (Research Analysts) Regulations, 2014.
Research report: Any written or electronic communication that includes research analysis, a research recommendation or an opinion concerning securities or a public offer, providing a basis for an investment decision. It excludes comments on general trends in the securities market; discussions on broad-based indices; commentaries on economic, political or market conditions; periodic reports or communications prepared for unitholders of a mutual fund or alternative investment fund or clients of portfolio managers and investment advisers; internal communications not given to current or prospective clients; communications constituting offer documents or prospectuses circulated under SEBI regulations; statistical summaries of financial data of companies; technical analysis relating to demand and supply in a sector or the index; and any other communication SEBI may specify.
Research services: Preparation or publication of a research report or its content; providing or issuing a research report or research analysis; making a buy, sell or hold recommendation; giving a price target or stop loss target; offering an opinion concerning a public offer; recommending a model portfolio; providing trading calls; and any other service of a similar nature or character, with respect to securities listed or proposed to be listed on a stock exchange, whether or not the person has the job title of research analyst, and whether provided to clients, other persons, a group of persons or the general public.

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Original explanatory writing based on the official NISM workbook for Series III-A, which is published and copyrighted by NISM. Check figures against the current edition at nism.ac.in.

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