You are here: Home » Opinion » Editorial » Editorials
Prudent regulation
Business Standard

Sebi's timely move

Lower public shareholding norms should help large IPOs

Topics
SEBI | initial public offerings IPOs | shareholding

Business Standard Editorial Comment  |  New Delhi 



The Securities and Exchange Board of India (Sebi) released a consultation paper on Friday, indicating that it was considering a reduction in the minimum stake offered in an initial public offer (IPO) with regard to larger companies. It will also extend the timeframe for meeting the minimum public (MPS) requirements for larger companies. Currently, any IPO of a company with a market cap of less than Rs 1,600 crore must offer a 25 per cent stake, while those with a market cap of Rs 1,600-4,000 crore must sell stake of at least Rs 400 crore (all calculated in terms of the post-issue paid-up capital at the offer price). Any IPO with a post-issue market cap of over Rs 4,000 crore must offer at least a 10 per cent stake. All listed companies must ensure there is an MPS of 25 per cent within three years of the IPO. These stipulations have been in place since 2014. The regulator now proposes the minimum offer threshold be reduced to 5 per cent in the case of IPOs with market caps exceeding Rs 10,000 crore. It will also extend the time period given for meeting MPS for larger IPOs.

TO READ THE FULL STORY, SUBSCRIBE NOW NOW AT JUST RS 249 A MONTH.

SUBSCRIBE TO INSIGHTS

What you get on Business Standard Premium?

  • icon Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
  • icon Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
  • icon Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
  • icon Pick your 5 favourite companies, get a daily email with all news updates on them.
  • icon 26 years of website archives.
  • icon Preferential invites to Business Standard events.

OR


Subscribe to Business Standard Premium

Exclusive Stories, Curated Newsletters, 26 years of Archives, E-paper, and more!

Insightful news, sharp views, newsletters, e-paper, and more! Unlock incisive commentary only on Business Standard.

Download the Business Standard App for latest Business News and Market News .

First Published: Sun, November 22 2020. 22:58 IST

RECOMMENDED FOR YOU

.