The Securities and Exchange Board of India will not relax the deadline for companies to achieve 25 per cent public shareholding.
The deadline for compliance is June 2013 for private companies and August 2013 for public sector undertakings (PSUs).
The SEBI Chairman, Mr U.K. Sinha, said: “I am going to make it difficult for companies who feel that the time limit is going to be relaxed.”
He was addressing a seminar on ‘Investment Outlook - 2012' at the BSE. He pointed out that six companies with a market capitalisation of over Rs 1,000 crore have to issue Rs 12,500 crore worth securities; eight companies between Rs 500 crore and Rs 1,000 crore market capitalisation had to issue Rs 5,300 crore worth securities.
Forty-three private companies have to issue securities aggregating Rs 25,000 crore.
Overall, private companies have to issue securities worth Rs 27,000 crore to achieve the minimum public shareholding norm. In addition, PSUs have to issue securities worth Rs 12,000 crore.
Mr Sinha promised that SEBI would make the process for issuing securities simpler but advised companies to treat the deadline as sacrosanct.
“The whole IPO process will be revamped in the next three to four months,” he said.
New Consent Guidelines
SEBI will unveil new guidelines on consent mechanism in the next four weeks, according to MrSinha. The consent mechanism entails disposal of proceedings against an accused, with the accused neither admitting nor denying guilt.
The accused has to follow the consent terms approved by the High Powered Advisory Committee of SEBI. The SEBI Chairman refused to comment on General Anti-Avoidance Rules (GAAR) stating that it was between the Government and the FIIs.
He asked stock exchanges to understand the risks of high frequency trading and enforce appropriate risk management mechanisms.
SEBI is working with the banking and insurance regulators to come out with a single KYC registration agency (KRA) across all three regulators. The Finance Minister had announced the development of a central KYC depository in FY13 to avoid multiplicity of registration and data upkeep in this year's budget.
SEBI also plans to launch a massive investor awareness campaign in July this year, Mr Sinha said.