Mumbai: The mechanism for initial public offers (IPOs) is being reviewed for the purpose of cutting down time and cost, market regulator securities and exchange board of India (Sebi) said on Monday. “A sub committee of primary market advisory committee has gone through various issues and it has submitted its report. This will be considered by PMAC sometime in February,’’ Sebi chief M Damodaran said, while debunking reports that Sebi had virtually decided to reduce the days
from 21 now to less than five for allotment of shares from the time of an IPO closes. “PMAC has been looking at various things. This is for simplification of processes to cut down time and cost. Once PMAC makes its recommendations, then Sebi will consider it. It will take some time,’’ he said. “It is not what has appeared in today’s papers. Today’s papers seem to give an impression... Two things they say—one that it is already (decided), it is not. In the next meeting they will still look at alternatives. Number two, they (papers) said, we are doing it because some particular issue has sucked up a lot of money. But it has been with the PMAC’s sub-committee for some time.
They have been looking (at it) for at least the last six months.’’ Damodaran said the time frame could not just be reduced to zero from being very long, as India was a continent size market and interests of retail investors will also have to be taken care of. He said that in many countries, retail investors were not allowed to participate in IPOs where only mutual funds come in. Retail investors participate in the secondary market and that is why they take lesser time, Damodaran added.
“It will be a retrograde step to say that retail investors (in India) should not be allowed to invest in IPOs. They need time,’’ he said while emphasising that the review of the processes was intended to save on time and cost. AGENCIES
Short selling from Feb 1
New Delhi: Notwithstanding volatility in the market, Sebi said short-selling by institutional investors would be introduced from february 1 and there is no change in the deadline. AGENCIES
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