Sebi plans revamp of large IPO norms; retail quota may drop to 25%

The Securities and Exchange Board of India (Sebi) on Thursday proposed changes to the structure of large initial public offerings (IPOs), including incre­asing the allocation limit for institutio­nal buyers and reducing the share rese­rved for retail investors. The proposals come amid a surge in IPO activity in India. 

Sebi noted that while average IPO sizes have been increasing, direct retail participation has remained flat over the past three years. For large public issues, retail subscription levels have been particularly muted, the regulator said. 

In a consultation paper published on its website, Sebi proposed that for IPOs exceeding ₹5000 crore ($571 million), the retail investor allocation may be reduced to 25 per cent from the current 35 per cent, while the allocation for institutional buyers may be increased from 50 per cent to 60 per cent in a graded manner.  

 

The regulator also proposed increasing the number of permissible anchor investor allottees for allocations above ₹250 crore, aiming to ease participation for large foreign portfolio investors managing multiple funds.  (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)