The Securities and Exchange Board of India (SEBI) has approved several regulatory changes simplifying IPO norms and foreign portfolio investing rules, as well as making entry norms for advisory certifications easier.
The key takeaways from the SEBI’s move are that large companies above Rs 50,000 crore market cap will now have more flexible listing norms, permitting them to have smaller float sizes- Rs 1,000 crore plus at least 8 per cent of the post-issue market capitalisation.
Further, they have extended timelines of up to 10 years to fulfil the 25 per cent minimum public shareholding requirement. Similarly, companies of different market capitalisations received relaxations of varying proportions. Anchor investor allocations in IPOs have increased to 40 per cent, now including insurance and pension funds alongside mutual funds in the reserved quota.
SEBI has reduced thresholds for related-party transactions, thereby lowering compliance burdens for large companies. Further, a new accredited investor (AI)-only category in alternative investment funds has been approved. The minimum ticket size for Large Value Funds has been lowered to Rs 25 crore from Rs 70 crore, a SEBI release said.
Sovereign wealth funds and pension funds will gain from the new SWAGAT-FI framework, which provides 10-year registrations, a single demat account, and exemptions from the FVCI rule requiring 66 per cent of corpus in unlisted equity.
Mutual fund regulations have been revised to reduce exit loads to 3 per cent from 5 per cent and increase distributor incentives for onboarding women and B-30 investors. Investment advisers and research analysts now face reduced entry barriers. Graduates from any discipline can qualify for NISM certifications. Documentation requirements such as address proof, CIBIL report, or net worth certificates are being scrapped.
SEBI has reclassified REITs as equity instruments, making them eligible for equity indices and mutual fund equity allocation limits. Further, to improve access for overseas investors, SEBI launched a new website called ‘India Market Access’ for foreign portfolio investors (FPIs). The portal will provide comprehensive regulatory and procedural details for those looking to invest in Indian markets.
