The Securities and Exchange Board of India (Sebi) is planning to review open offer pricing of public sector undertakings.
Sebi is also planning to review pricing norms for initial public offerings (IPOs) in order to bring in a more efficient price discovery system.
In its recent amendments to the Sebi Substantial Acquisition of Shares Regulations or takeover code, it was decided that open offer pricings would be based on the 26-week high-low average price or two-week high-low average price whichever is higher, prior to the date of opening of the financial bids.
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Prospective bidders have conveyed their unhappiness with the two-week average price rule as they feel that the stock prices will be open to manipulation.
They also feel that a last minute flare-up in prices in the run-up to the opening of the bids might be impossible to factor in their bids.
Bajpai said the watchdog is in the process of studying the scenario and ascertaining possibilities of price manipulation and whether it might prove harmful to any class of investors.