SEBI board meeting on March 29: New-age tech firms’ IPO, CIS rules may be discussed

SEBI board meeting: The Securities and Exchange Board of India (SEBI) board meeting is scheduled to be held on March 29, 2022. It is expected that the strictness will increase for new-age technology companies which are not able to make a profit but still come to raise money through IPO, Zee Business Assistant Editor Brajesh Kumar reports.

All companies will provide DRHP with more information on non-financial performance indicators like subscriptions, downloads, etc so that investors can understand the future potential of the company, this point will also be considered in the meeting, said Kumar.

Along with this, companies will also have to disclose if more than 5% of the IPO has sold in the primary and secondary market before, then how is it rated on the basis of performance indicators, so that investors can understand how the valuation is done and what are the strings behind the company’s claims regarding growth potential.

The second point is the rules which are applicable to Mutual Funds are almost in the process of being applicable for Collective Investment Schemes as well. 50 crore net worth, 5 years of consistent profit, and 5 years of experience are mandatory for companies to launch Collective Investment Schemes. Also, to start this scheme, at least 20 investors and a subscription of 20 crores are also mandatory.

In addition to that, the officers of Collective Investment Schemes will have to invest 20% of their salary in that scheme.

The third important point is how to recover the secondary sale of the corporate bond market as there is no liquidity in it. In this, the mechanism of market making can be considered.

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