Mumbai: The Securities and Exchange Board of India's (SEBI) on Friday organized a Board of Meeting. Post the meeting, Chairperson Tuhin Kanta Pandey revealed a set of sweeping-reforms.
Speaking to the media, the SEBI chairperson announced the details.
Here are the top-five key takeaways from the conference, held a few minutes away.
EASIER RULES: Revision in Minimum Public Shareholding Norms
The Sebi board has eased IPO rules for very large firms. The SEBI also extended timeline of up to 10-years to meet minimum public shareholding requirements.
Easier rules on minimum public shareholdings to simplify fundraising in India.
Revision in Minimum Public Shareholding Norms: Minimum public Shareholding or MPS norms have been marginally tweaked. There is no change with regards to MPS for companies with a market-cap of Rs 50,000 crores. But for organisations with m-cap of over Rs 5 lakh crores, the minimum public offer size is set at 1% or ₹15,000 crores.
The SEBI Chairperson also informed that in the likelihood of public shareholding at 15% or more, MPS of 25% will have to be achieved in five years.
PROMOTING FOREIGN INVESTMENTS (FIIs/FPIs)
SEBI Chairperson, Tuhin Kanta Pandey informed that the board had eased FPI entry into Indian capital markets with the introduction of a single window access to boost inflows.
To empower FPIs with information, SEBI has announced a new website - indiamarketaccess.in.
IPO ALLOCATION FRAMEWORKS
Besides MPS, the Chairperson also informed that Sebi had decided to revamp share-allocation framework for anchor investors in IPOs to broaden institutional investors' participation.
Additionally, Life Insurance companies and Pension Funds will be included in reserved category as part of the IPO anchor book. The Chairperson also informed of a reserved limit for anchor portion in IPO which has been increased to 40% from one-third of the IPO size.
MARKET SCHEMES
SEBI has classified REITs and InVITs as equity instruments.
More commission to Mutual Fund distributors for first-time women investors to empower women.
EASE IN COMPLIANCE
Relaxation in norms such as CIBIL reports and NET worth requirements.
Market Infrastructure Institutions (MIIs) will have norms as regards directorship of MDs and EDs in other companies. MIIs will have to prioritize critical operations, regulatory, compliance, risk management, investor grievance over commercial interest.
Institutions are also expected to clearly define the role of MDs, EDs and specific Key Managerial Personnel (KMPs).
Simplification of minimum shareholdings will simplify fundraising in India.
Post the announcement, social media has been buzzing calling the set of reforms much desired. Ahead of the announcements, there were market-rumors that the SEBI might elaborate on F&O weekly expiries. However the set of reforms announced today have been more than what the market could have sought for.
