Friday, July 06, 2018

SEBI Approves Changes in IPO Norms

SEBI - The Securities and Exchange Board of India approved the new ipo norms. Now IPO price band can be announced two working days before subscription of the offer. Currently the time frame is before 5 days and SEBI changed it to 2 days.
"The requirement of announcing price band five working days before opening of the issue would be reduced to two working days before opening of the issue," said the SEBI.

IPO Norms Changes:
  • IPO Dates to be announced 2 working days before subscription of the offer which is currently 5 days.
  • The financial disclosure need to made for 3 years which is currently requirement is 5 years.
  • The offer documents should be made on consolidated financial disclosures only.
  • Threshold for submission of draft letter of offer to SEBI in case of rights issues to be increased to Rs 10 crore earlier it was Rs 50 lakh - As per the release.
  • The Buy Back period has been defined as the period between  board  of  directors  resolution/date  of  declaration  of  results  for  special resolution  authorizing  the  buyback  of  shares  and  the  date  on  which  payment consideration is made to the shareholders. 
  • Shortfall of up to 10% in minimum promoters’ contribution may be met by institutional   investors   such   as   by   foreign   venture   capital   investors, scheduled  commercial  banks,  public  financial  institutions  and  insurance companies   registered   with   Insurance   Regulatory   and   Development Authority of India, in addition to Alternative Investment Funds, without being identified as Promoters.
  • For a company to be eligible to make a fast track rights issue, it should not have any audit qualifications or adverse opinion.
  • For SME IPO - Minimum Anchor investor size to be reduced to Rs. 2 Crore from the existing Rs. 10 Crore.
Full Release on IPO Norms: Click Here