The Securities and Exchange Board of India will soon notify new norms for the listing of start-ups and small and medium enterprises on the stock exchanges without having to make initial public offer (IPO).
The SEBI board had in June approved the amendment of rules to permit the listing of start-ups and SMEs in institutional trading platform without an IPO.
According to sources, the Securities and Exchange Board of India is expected to notify the new regulations within a week.
Lack of exit opportunities for investors and restricted access to new ones is a major problem faced by start-ups and SMEs.
The sources said that the move is aimed at providing easier exit options for entities such as Angel Investors, Venture Capital Funds and Private Equities. Besides, the move will provide better visibility, wider investor base and greater fund-raising capabilities to such companies.
SEBI had said in June that the minimum amount for trading or investment on ITP would be Rs 10 lakh. Such companies would also be exempted from the requirements of having to offer up to 25 per cent of shareholding to public through an offer document in order to get listed.