Mumbai: Sebi Watchdog Market on Tuesday tenses the norm for the initial public offering (IPO) after a series of problems seeing the company raising funds for ambiguous reasons and investors must deal with high volatility after the main shareholders sell their ownership immediately after a list of new companies.
Under new norms, large shareholders in the company (with more than 20% of the shares) cannot sell more than 50% of their detention as part of the offer for sale (ofs).
It becomes relevant as at startup, private equity investors are large shareholders and no promoters that can be identified.
The current norm allows this large shareholder to completely out.
To improve the norms of disclosure, the company can only allocate 25% of the results of a problem for the acquisition where the target has not been identified.
Total allocation for unknown acquisitions and ‘general company goals’ cannot exceed 35%.
The publisher must appoint a credit rating agency to monitor and report the use of final funds.
In a council meeting held on Tuesday, Sebi said that the anchor investors had to accommodate half of their ownership for at least 90 days in addition to the current requirements invested for a month.
Companies such as Zomato and Paytm down a month after listing after anchor investors are sold at the end of the key period.
Non-institutional investors will now be divided into two categories.
One third of these problems will be provided for those who invest between Rs 2 Lakh and Rs 10 Lakh and the remaining two-thirds are for those who invest Rs 10 lakh and above in this issue.
This step will prevent smaller investors from being squeezed.
To ensure that the company is not too ambitious in their prices, Sebi has asked them to have top price ribbons which are at least 105% higher.
The Chairman of Ajay Tyagi confirmed that the regulator had no intention of controlling the price of the IPO in any way.
“Discovery prices are market functions and that’s how it works globally,” he said at the media briefing after the council meeting.
Regulators also approve the introduction of special situation funds (SSF) which will only invest in poor debt assets.
SSF will be introduced as a sub-category in the 1 category of alternative investment funds (AIF).
This step will greatly help the operation of the National Asset Reconstruction Company, which will obtain most of the bad debt from the public sector bank.
To improve corporate governance in the registered company, the regulator has forbidden them to appoint the Directors who have been rejected before by shareholders, without the expression of shareholders.
In the impact of its upheaval with PNB housing over assessment of shares in preferential issues to new owners, Sebi said that preferential problems will require an independent assessment when it produces changes in ownership.