SEBI on IPO: Buying and selling of shares may get approval before listing
New Delhi| Capital markets regulator SEBI, while acknowledging the transformative role played by the National Stock Exchange and the Bombay Stock Exchange in driving economic growth, is considering a platform that allows share allottees in public offerings (IPOs) to formally list. Can allow securities trading even before. That means trading of shares can be allowed before listing. SEBI Chairman Madhavi Puri Butch gave this information during a program organized in Mumbai. He said that investors remain interested in the shares from the three days after their allotment till the trading of the shares starts. In view of this, if investors want to trade then they should be provided this opportunity properly and legitimately.
SEBI Chairman said – Trading of shares in gray market is completely wrong
SEBI Chairman said that even if the trading of shares has not started in the market, those shares must have been allotted to that person, hence he becomes already entitled to the shares. This system will allow investors to trade in the time between the deposit of shares in the demat account and actual listing on the stock exchanges. Emphasizing the need for this, he said, as the trading of unlisted shares in the gray market is increasing, which is completely illegal. Butch said that during the premium listing of the gray market, investors sometimes see it as a profit opportunity. Along with this, Butch said that the IPO documents should contain enough information to assess the pricing, so that investors can take the right decision on their own.
The regulator will take steps to ensure that the investor assesses the shares correctly
SEBI focuses more on determining the true value of IPOs but on ensuring that investors have access to the correct and necessary data to assess whether they are eligible. We think we examine the documents of each IP in such a way that if we are investors and are reading the documents, there is enough information, especially in the price determined section, to help investors assess. Apart from this, topics like taking startups to IPO success, opportunities for growth in SME IPs, enhancing India’s IPO framework for global competitiveness and global benchmarking of IPOs and shaping the future of capital markets are considered in the programme.
Opinion of experts
Market experts say that this statement of SEBI Chairman has come at a time when there is a record jump in the number of IPOs in the primary market along with accumulation of funds. The National Stock Exchange leads Asia in number of IPOs in 2024 and also holds the record in terms of equity raised from this market. Market data shows that about Rs 1.80 lakh crore of public issues i.e. IPOs are already awaiting SEBI approval in the year 2025. Experts say that this decision of SEBI will promote transparency in the market and will also pay attention to the investment security of the investor. In view of the increase in the number of IPs in the last few years, SEBI has cleared its stance, which was expected by the market, because SEBI aims to empower investors to follow the market rules and take appropriate decisions.
