Chairman Ajay Tyagi made a presentation on the current market trends, challenges, and the implementation road map for Budget-related announcements.
Sebi-related key Budget proposals include setting up of a gold spot exchange, the introduction of a unified securities markets
code, and an investor charter.
The finance minister stressed the need for the timely implementation of the capital market-related Budget announcements.
The government is looking to launch LIC’s IPO in the next financial year.
Based on the earlier norms, LIC would have been required to divest at least 10 per cent at one go. The latest change will give the government -- which owns 100 per cent of LIC –the flexibility to assess market demand and opt for lower dilution.
“The changes will be beneficial for large IPOs
like LIC,” said Tyagi, on the sidelines of the meeting.
Under the current rules, a company with post-listing market capitalisation of Rs 4,000 crore needs to offer at least 10 per cent stake to public shareholders. And those below Rs 4,000 crore have to offload at least 25 per cent. The rules are aimed at ensuring adequate public float and better price discovery.
Experts said the new rules will benefit large issuers, but can also lead to concerns around low public float.
At the board meeting, Sebi
also prescribed the net-worth requirement to allow investment bankers and stockbrokers to carry out underwriting activities.