TheNFAPost Podcast

Several sweeping changes have been proposed for the IGP platform by Sebi to pave the way for easier fund raise by startups.

The latest relaxations could help the Innovators Growth Platform (IGP) to take off, which is yet to see any listing.

Introduced in 2019, IGP is aimed at providing technology-oriented startups or companies with early-stage investors a listing opportunity with a much more relaxed framework compared to the mainboard.

Sebi has eased the listing requirement of the holding of the company’s 25 per cent pre-issue capital from two years to one year by an institutional investor and other large investors on IGP.

Sebi also allowed up to 25 per cent of pre-issue shareholding of an individual investor with net worth of Rs 5 crore eligible for listing.

Sebi also allowed companies with superior voting rights to list on IGP.

In addition, the open offer trigger for companies listed on this platform has been eased from 26 per cent to 49 per cent.

Sebi has also made it easy for companies to delist or to migrate to NSE or BSE.

Meanwhile, the Sebi board has also eased delisting regulations. The promoters will have to disclose their intentions to delist.

Also, independent directors will have to guide the minority shareholders of a delisting-bound company by providing a reasoned recommendation on the delisting proposal.

Further, Sebi has made various timelines associated with delisting more efficient.

Sebi has also provided some relaxation with regard to reclassification of promoter shareholding.

Promoters with less than 1 per cent shareholding and no ‘control’ will not be required to see shareholders’ nod for reclassification to ordinary shareholders.

Also, the Time gap between the date of board meeting and shareholders meeting has been reduced to make the process more efficient.

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