The Hindu Business Line : QIP route: SEBI sets norm of minimum 1 year listing

Mumbai April 30 Companies should be listed at least for a year to be eligible for making qualified institutional placement, according to the SEBI's new guidelines.

As per the SEBI's amended the guidelines, companies are allowed preferential allotment with in six months of being listed, subject to complying with the modified pricing and disclosure norms.

Earlier, SEBI had announced that it would be mandatory to grade all initial public offerings. Further to this, SEBI has now announced that the grading shall be done by credit rating agencies, registered with SEBI under the SEBI (Credit Rating Agencies) Regulations, 1999.

Grading has to be obtained from at least one credit rating agency. The issuer shall be required to disclose all the grades obtained by it for its IPO in the prospectus, abridged prospectus, issue advertisements and all other places where the issuer is advertising for the IPO. All expenses incurred for grading of IPO are to be borne by the issuer. The grading will be applicable to all IPO's from May 1, 2007.

Under the amendment made by SEBI regarding the processing of draft offer documents incorporated in the new DIP guidelines, SEBI has said that they will issue observations on the draft offer documents that are filed with incomplete information only after the receipt of satisfactory replies from the Lead Manager/s to queries raised.

SEBI has also thrown some more light on provisions relating to minimum promoters' contribution for the purpose of public issues. The guidelines have been amended to provide that securities, which have been pledged with banks or financial institutions as collateral security for loans, shall not be eligible for computation of minimum promoters' contribution.

More Stories on : IPOs | Preferential Allotments | Regulatory Bodies & Rulings

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