Proposal, currently active by a top Securities and exchange board (SEBI) panels, such as institutions will allow National stock exchange ,
The current SEBI rules states that if the issue of a company is above the capital of the capital ₹ 1 lakh crore, then there is a need to offer 5% equity in the initial public offering (IPO) and issue shares of ₹ 5,000 crore.
Agencies Exit for initial investors
“There is a consensus between the members of the committee that the rules should provide a competent provision to allow promoters to be reduced.”
The Capital-Markets Regulator has formed a sub-group under the Primary Market Advisory Committee to look into the proposal. The group is likely to recommend that large companies be allowed to dilute 2.5% and release shares worth ₹ 7,500 crore, with four people familiar with development.
In 2022, SEBI allowed the government to divide 3.5% into the Life Insurance Corp (LIC) IPO, exempted from compulsory 5% listing on the float. The regulator also exempted LIC from the lock-in requirement for the shares allotted to the anchor investors.
LIC, which was an evaluation of ₹ 6 lakh crore, raised of 21,000 crores through its IPO.
A top investment banker with a foreign bank said, “There is justification, these are very large companies that do not need so much capital, but at the same time, they want to get out of their early investors.” “You can do an IPO with a low number and provide investors access to a good company and also complete the minimum public holding criteria in a defined time limit,” he said. The country’s leading digital payment provider supported by Walmart, PhonePe, is demanding $ 1.5 billion in the IPO in the $ 15 billion evaluation. Depending on when the new rule applies, this step will also help the company.
It can also help Philipkart, another company supported by US Retail Major Walmart, which can also be in the list in the domestic market.
NSE, which is preparing to go public next year, evaluates more than $ 50 billion, while Mukesh Ambani’s Reliance Jio Infocomm, which is also planning a listing, is being given a price of more than $ 150 billion by analysts, will also be the major beneficiaries.
A managing director at a large domestic investment bank said, “This is a challenge for promoters to create a big public issue demand. It also useless liquidity from the market and causes an imbalance.”
Last year, the largest primary amount in the IPO incorporates Hyundai Motors. The South Korean car manufacturer raised ₹ 27,000 crore in the IPO. The other major IPO Swiggy and NTPC were by Green, where they raised more than 11,300 crores and more than ₹ 10,000 crore respectively.
Last month, HDB Financial Services raised of Rs 12,500 crore through its public offer.
An initial share sales with the size of an issue of more than ₹ 10,000 crore are cleaned only by the Chairman of SEBI.