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Outcome of 35% minimum public shareholding

Such an enforced dilution will offer chances to buy into certain closely-held shares

Devangshu Datta

The implications of the Finance Minister’s “thought experiment” – every listed entity should have a minimum 35 per cent public shareholding – are worth considering in detail. Most Public Sector Units (PSUs) don’t meet that criteria and a counting-on-fingers assessment suggests that one out of every three or four listed companies doesn’t meet that criterion. Assuming Securities and Exchange Board of India (Sebi) goes along – and don’t forget that Sebi is, technically, an independent regulator – there would be an enormous ...