Sebi Chairperson Madhabi Puri Buch.
The Sebi chief said, “If disclosures on valuations are meaningless, we will definitely look into it.”
Amid concerns in some quarters over overvaluation of some initial public offerings, Sebi chairperson Madhavi Puri Buch said the regulator must look into the matter if disclosures about valuations do not make sense.
This comment came amid several share sales in the capital market recently.
Last week, five companies including Tata Technologies came up with their IPOs which fetched a record Rs 2.6 lakh crore in application volume.
“Of course, we are completely with you on this because the arguments given for the high premium are nothing but some meaningless English words,” Buch said in response to a question about the high premium for some shares in the IPO.
“We will definitely look into it and resolve the issue,” he said.
Asked about concerns in some quarters that some IPOs are overvalued, the Sebi chief said, “If disclosures on valuations are not meaningful, we will certainly look into it.”
It is observed that to increase investor interest in IPOs of little-known companies, issuers and their investment bankers quote a low face value but overprice the issue due to a very high premium.
Whether Sebi plans to advise issuers and other market makers on their issues in a more timely manner and with sufficient gaps between the two issues, Buch said that is not the regulator’s job. “Ultimately, it’s not our job to time the market”.
“We want to leave the issue timing to the market. Otherwise it will be unfair on our part as SEBI timing may not be best for issuers and investors. A company comes to the market to raise money at a time that suits them best.
“Also, we are not concerned about the issue because our job from a regulatory perspective is to ensure that the system can take the load that our market is doing perfectly well,” he said, adding that institutional capacity is not an issue at all. .
“At least on this front nothing negative has come to our attention yet,” he said.
Asked whether Sebi would allow the green-shoe option to allow other market operations where the issuer has the freedom to hold substantial subscriptions, he said the answer is no as it has to be addressed from a Practical and Conceptual Perspectives.
“From a practical point of view, it is possible but from a conceptual angle, it is not possible unlike a debt issue or any other market instrument where there is no equity dilution, an IPO is precisely an equity issue. So if we allow a green shoe option, it will lead to an undesired dilution of equity and other impacts,” he said at a press briefing after Sebi’s board meeting here on Saturday.
(This story has not been edited by News18 staff and appears from a syndicated news agency feed – PTI)
Where we collect the information from Source link
Disclaimer:- We include in each post a link to where each content on our website is collected from.If there is a complaint against any post please contact us directly.
Email: post-support.dailyfastnews24.com
You can also write on the popular online news portal dailyfastnews24.com. Writing topics feature, travel, lifestyle, career, IT, agriculture and nature. Send your entry today to [email protected]
advertisement:-If you would like to advertise on our website please contact us here.Our Ads team will contact you very soon.
Email: [email protected]
The cost of advertising:- 1 Post 100 USD Lifetime.
Thank you very much for visiting our website. Have a good day.