Saturday 5 May 2018

Sebi proposes changes to norms governing raising of equity capital

Sebi. (Photo: Kamlesh Pednekar)

The Securities and Exchange Board of India (Sebi) on Friday proposed a slew of changes to norms governing raising of equity capital.
Among the changes suggested by the Sebi include an increase in threshold from Rs 5 million to Rs 100 million for filing of a “draft letter of offer” for a rights issue. The regulator has also proposed to reduce the time gap between announcement of the price band and launch of an initial public offering (IPO) from five working days at present to just two working days.

Further, the Sebi has proposed to allow companies to extend the IPO time period from three days without reducing the price band. Sebi has also proposed to merge the provisions of the institutional placement programme (IIP) with those of qualified institutional placement (QIP). Changes have also been proposed for the small and medium enterprises (SME) platform. Among them are increasing the maximum post-issue face value capital for a SME public issue from Rs 250 million to Rs 500 mn. Also, provisions for SME follow-on public offer and rights issue.

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