Sebi cuts IPO listing time by half to three days

The reduction in timelines for listing and trading of shares will benefit both issuers as well as investors, said the regulator.
Image used for representational purpose. (File photo)
Image used for representational purpose. (File photo)

MUMBAI: The Securities and Exchange Board of India (Sebi) on Wednesday reduced the time period for listing of shares in public issue to three days (T+3) from the existing six days (T+6),  which would allow investors and issuers to get their shares and money quickly.

The new listing time-frame will be voluntary for all public issues opening on or after September 1 and mandatory for all the issues that come after December 1, said the capital markets regulator in a circular issued on Wednesday.“Consequent to extensive consultation with the market participants and considering the public comments received pursuant to the consultation paper on the aforesaid subject matter, it has been decided to reduce the time taken for the listing of specified securities after the closure of a public issue to three working days (T+3 days) as against the present requirement of six working days (T+6 days); ‘T’ being issue closing date,” said Sebi in its circular.

The reduction in timelines for listing and trading of shares will benefit both issuers as well as investors, said the regulator. Issuers will have faster access to the capital raised thereby enhancing the ease of doing business and the investors will have the opportunity for having early credit and liquidity for their investment. 

The regulator said that the compensation to investors for the delay in unblocking of ASBA (Application Supported By Blocked Amount) application money shall be computed from T+3 day.

The capital market regulator said that Registrar to an Issue would undertake third-party verification of the applications by matching the PAN available in the demat account with the PAN available in the bank account of the applicant. In instances of mismatch, such applications would continue to be considered invalid applications for finalising the basis of allotment.

According to the circular, the application process should be completed within 5 pm of the closing date.  Modification of the bid, too, would be allowed until such time. Finalisation of applications and rejections shall be done by 6 pm the following day (T+1).  

Once approved by the stock exchanges, funds can be deducted from the Application Supported by Blocked Amount (ASBA) accounts of investors and must be completed by 2 pm on the T+2 day.

TO BENEFIT BOTH ISSUERS AS WELL AS INVESTORS
Reduction in timelines for listing and trading of shares will benefit both issuers as well as investors, said the regulator. Issuers will have faster access to the capital raised thereby enhancing the ease of doing business and the investors will have the opportunity for having early credit and liquidity for their investment. Sebi said the compensation to investors for the delay in unblocking of ASBA (Application Supported By Blocked Amount) application money shall be computed from T+3 day

Related Stories

No stories found.
The New Indian Express
www.newindianexpress.com