They could be unconnected. But the ₹53,000 crore rights offer of Reliance Industries Ltd (RIL) in May was preceded by an innocuous tweak by SEBI to one of its rules governing rights issues in the market.

On April 21, SEBI said that it would allow companies even with pending prosecution proceedings to raise money through fast-track rights issues. The rules were eased thus so that companies under stress due to the Covid-19 lockdown could raise funds. RIL announced its rights issue a few days later, on April 30.

As per the earlier regulatory norm, any company that had any case or prosecution proceedings pending with SEBI was not allowed to raise money through the fast-track right issue route. RIL is currently in an adjudication proceeding relating to allegations of insider trading, levelled by SEBI. Therefore the company could not have raised money in fast-track mode under the earlier rule.

A fast-track issue is where the company does not require SEBI approval. Just 20 days after announcing the rights issue, RIL opened its books to mobilise funds, on May 20, and closed them in June. RIL’s rights issue was oversubscribed 1.59 times.

Both SEBI and RIL did not respond to an email query. A source close to RIL said that while the relaxation of rules by SEBI may have benefited Reliance, the rights issue was planned months in advance, even before the Covid-19 lockdown happened.

“SEBI has been making changes to several of its norms to help companies raise funding on the back of the emergency situation (Covid crisis). One such relaxation was for rights issues. RIL got an advantage but even other companies are on an equal footing,” said a senior Mumbai-based equities lawyer.

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