Participatory Notes (P-notes)

  • P-notes are offshore/overseas derivative instruments (ODIs) issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly.
  • They, however, need to go through due diligence process.
  • P-Notes are not used within the country but are mainly used outside India for making investments in shares listed in the Indian stock market.
  • SEBI had permitted FIIS to participate and register in the Indian stock market in 1992. 
  • Earlier, investing through P-Notes is very simple and is very popular amongst FPIs, FIIs.
  • Note: Investments through participatory notes (P-notes) into Indian capital markets- equity, debt, and derivatives have plunged to over nine-year low  due to stringent SEBI norms. - Participatory Notes (P-notes)