New Delhi: The Securities and Exchange Board of India (SEBI) on Friday announced a series of regulatory changes after its board meeting, including a major relaxation in minimum public shareholding (MPS) norms for large companies planning initial public offerings (IPOs).
According to SEBI’s release, companies with a market capitalisation of Rs 50,000 crore to Rs 1 lakh crore will now get more time to meet the public shareholding requirements. They will be required to achieve 15 per cent MPS within five years of listing and 25 per cent within 10 years.
At present, companies are required to meet the 25 per cent threshold within three years. This move is expected to make fundraising easier and reduce pressure on companies to immediately dilute large stakes, which often affects share prices. Experts said the step will also reduce the need for companies to seek case-by-case exemptions from SEBI.
In another decision, SEBI allowed real estate investment trusts (REITs) and Infrastructure Investment Trusts (InVITs) to be classified as equity instruments. This change will make it easier for mutual funds to invest in them and is expected to increase retail investor participation in these asset classes. SEBI also amended governance norms for stock exchanges and depositories, aiming to improve transparency and oversight in market institutions.
Additionally, the regulator has relaxed eligibility criteria for investment advisors and research analysts. From now on, a graduate in any discipline will be eligible to apply, though clearing the NISM certification remains mandatory. SEBI has also simplified requirements around credit reports, net worth and asset-liability statements.
To improve access for overseas investors, SEBI launched a new website called “India Market Access” for foreign portfolio investors (FPIs). The portal will provide comprehensive regulatory and procedural details for those looking to invest in Indian markets.
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