Capital markets regulator Sebi Friday expanded its offer for sale (OFS) framework to all the companies with market capitalisation of Rs 1,000 crore and above.
Currently, the OFS framework is available to top 200 companies by market capitalisation.
Also, if the seller fails to get sufficient demand from non-retail investors at or above the floor price on the first day of offer, then the seller may choose to cancel the offer post bidding, in full (both retail and non-retail), on the first day itself and not proceed with the offer to retail investors on the second day.
"OFS mechanism shall be available to companies with market capitalisation of Rs 1,000 crore and above, with the threshold of market capitalisation computed as the average daily market capitalization for six months period prior to the month in which the OFS opens," the Securities and Exchange Board of India (Sebi) said in a circular.
The mechanism has been successfully used to divest stake by promoters and large shareholders.
The move comes after the board of Sebi approved a proposal in this regard earlier this month.
According to a report by Prime Database, a total of Rs 10,678 crore have been raised through the OFS mechanism this year. The largest OFS was that of Coal India (Rs 5,274 crore) followed by Larsen & Toubro Infotech (Rs 1,846 crore).