Top 1,000 companies by m-cap to have dividend distribution policy: Sebi

In an action packed board meeting, market regulator Securities and Exchange Board of India on Thursday approved several amendments to Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Requirement for formulation of dividend distribution policy by the existing top 500 listed companies has been extended to the top 1,000 listed companies on the basis of market capitalisation.

In case of board meetings held for more than one day, the financial results must be disclosed by the listed entities within 30 minutes of end of the board meeting for the day on which the financial results are considered.

The market regulator also made it mandatory for companies to release audio recording of all analyst meetings in 24 hours.

The timelines for submission of periodic corporate reports have been harmonised to 21 days from the end of each quarter.

The Sebi board also approved amendments to delisting regulations with an objective to make the delisting process more transparent and efficient.

Under the new regulations, promoter or acquirer will be required to disclose their intention to delist the company by making an initial public announcement. The Committee of Independent Directors will be required to provide their reasoned recommendations on the proposal for delisting.

Further, timelines for completion of various activities forming part of delisting process have been introduced or revised to make the process more efficient.

Promoters will be permitted to specify an indicative price for delisting which shall not be less than the floor price and they will be bound to accept the price discovered through reverse book building if the same is equal to the floor price.

The board has also decided to introduce new requirements for sustainability reporting by listed entities.

This new report will be called the Business Responsibility and Sustainability Report (BRSR) and will replace the existing Business Responsibility Report (BRR).

It will be applicable to the top 1000 listed entities (by market capitalisation), for reporting on a voluntary basis for FY 2021–22 and on a mandatory basis from FY 2022–23.

Sebi also rationalised the existing framework for reclassification of promoter companies. 

Exemptions will be given to existing requirements, in cases of reclassification in line with existing exemption already available to cases of resolution plan approved under section 31 of the Insolvency code and also the requirement of seeking approval of shareholders in cases where the promoter seeking reclassification holds shareholding of less than 1 per cent, subject to the promoter not being in control.

The market regulator has also approved amendments to make Innovator Growth Platform more accessible to companies in view of the evolving start-up ecosystem.

Present eligibility requirement under IGP, for issuer to have 25 per cent of pre-issue capital held by eligible investors for two years period, is reduced to one year.

At present, pre-issue shareholding of such investors for meeting eligibility, is considered for only 10 per cent, which is now increased and will be considered for the entire 25 per cent required for meeting eligibility norms