Chennai: Market regulator Securities and Exchange Board of India (SEBI) has decided to cut short the time duration for coming out with rights issue from the current 109 days to 60 days to enable more and more corporates to raise capital, said CB Bhave, Chairman, SEBI.
“The number of days to come out with a rights issue can be still brought down further by sprucing up the number of processes at a greater speed,” Bhave told the reporters in Chennai on Tuesday. Bhave was in Chennai to address one-day workshop on capital market titled `Issues of the Indian Capital Market and its Evolution in the Future’, organised by Federation of Indian Chambers of Commerce and Industry (FICCI).
To a question on an effective use of demat route for bringing down the number of days for issuing rights shares, Bhave said that the market regulator is examining suggestions made by various investment banks. The regulator is hopeful of completing the process in due course of time and the same will be put on SEBI website for public discussion before taking a final decision. The entire process would be over in two to three months time, he said.
To a question on retail investors woes on IPO refund payments, he said five banks have come forward to ensure that the funds are not blocked unless the shares are not actually allotted to them. These banks are Corporation Bank, SBI, HDFC Bank, ICICI Bank and Union Bank of India. Five more banks are expected to join the system, he said.
Bhave also said that both SEBI and the Reserve Bank of India (RBI) are planning to set up a committee to look into various issues cropping up on the mergers and acquisitions (M&As) in the Indian corporate sector. The new committee will examine thoroughly and will come out with a new framework which will ensure more transparency during the mergers and acquisitions, he added.
To a question on whether all listed companies are following the listing norms on the independent directors, he said: “Some of them are not. In some cases we have issued them notices too.” There is an adjudication procedure under which these notices have been issued, he said, declining to name the companies.
