Can I promise or guarantee returns to a client?
In force
No. The Most Important Terms and Conditions that every analyst must give a client state plainly that recommendations carry no assurance of returns.
The advertisement code goes further. You may not promise or imply assured returns, minimum returns, a target return, a percentage accuracy, or service continuing until a target is reached.
A separate rule catches the other direction. You may not promise a company, sector or business group a favourable review in order to win or influence a business relationship.
For completeness, the Code of Conduct in the Third Schedule contains no clause about promising returns. The duties it does impose are set out under Code of Conduct.
What SEBI says, word for word
MITC, Standard Clause“The recommendations provided by [the RA] do not provide any assurance of returns.”Source: MITC Annexure to SEBI Circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/20, dated February 17, 2025 Open document ↗
Regulation 18(8)“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”Source: SEBI (Research Analysts) Regulations, 2014 — Regulation 18(8) Open document ↗