Mumbai: Sebi Chairman Tuhin Kanta Pandey on Friday said the capital markets regulator is in the process of developing an artificial intelligence-powered tool to analyse regulated entities' cyber safety preparedness.

Speaking at the BSE here, Pandey also said Sebi is in the process of constituting a working group to develop a technology roadmap for market infrastructure institutions (MIIs).

"AI-driven inspection tool is currently under development to strengthen risk-based supervision of regulated entities," Pandey said, while speaking at the oldest stock bourse's benchmark Sensex's 40th anniversary event.

The tool under development will analyse cyber audit reports, identify control gaps, and classify entities based on their risk exposure, Pandey said. The technology roadmap will provide MIIs a structured five years (short-term) and a 10-years (long-term) strategic technology vision for the securities market ecosystem, Pandey added.

He urged exchanges and other MIIs to continue investing in technology, risk management and cyber resilience.

"We have to ensure that innovation strengthens, not weakens, market integrity," he added.

Sebi has been focusing on strengthening regulatory architecture that upholds the integrity of the market amid the widening participation and diversification in investor base, he said.

"Enduring markets are not built on momentary highs or cycles of optimism. They are built on institutions that inspire trust, regulation that evolves with markets, and systems that continuously adapt and upgrade," the Sebi chief added.