SEBI accelerates IPO listing process, reducing timeline to 3 days after closure. Benefits for companies and investors. New regulations for mutual fund expense ratios also anticipated.

SEBI Cuts Listing Timeline for IPO Shares

The Securities and Exchange Board of India (SEBI) has shortened the time it takes for shares from Initial Public Offerings (IPOs) to be listed on stock exchanges. This change aims to speed up the process and enhance business efficiency.

New Listing Timeline Introduced

SEBI has reduced the listing timeframe from six days to three days after the closure of an IPO. This change will be implemented voluntarily for public issues opening on or after September 1, and it will become mandatory for all issues after December 1.

Benefits for Issuers and Investors

The shorter listing and trading timeline has advantages for both companies issuing IPOs and the investors participating in them. Companies can access raised capital more quickly, promoting ease of business. Investors gain early credit and liquidity for their investments.

Verification of Applications

To ensure accurate application verification, the Registrar to an Issue will cross-check PAN details in the demat account with those in the applicant’s bank account. Applications with mismatches will be considered invalid for allotment.

SEBI’s June Decision

In June, the SEBI board approved this change in listing time, moving from six days to three days after the IPO’s closure. The decision followed extensive consultation with stakeholders and stress testing to ensure a smooth transition.

Future Regulation on Expense Ratios

SEBI deferred its plan to regulate total expense ratios charged by mutual fund houses. A new consultation paper will be released with significant changes from the previous draft, addressing concerns and ensuring better regulations.

The changes made by SEBI aim to streamline IPO processes and bring more clarity to mutual fund expenses.