SEBI has allowed companies to make two qualified institutional placements (QIPs) with a gap of just two weeks between them.
The earlier regulations mandated a minimum gap of six months between two such issuances.
Promoters can also increase their stakes in their companies through preferential allotments by up to 10% without triggering an open offer.
The cap was earlier set at 5%.
SEBI has, however, allowed this relaxation only for the current financial year.
The twin moves would help in enhancing liquidity in the market while promoters could also acquire shares at a time when valuations were quite low compared with the historic highs.
Important value additions
The Securities and Exchange Board of India (SEBI)
It is the regulator of the securities and commodity market in India owned by the Government of India.
It was established in 1988 and given statutory status through the SEBI Act, 1992.
SEBI is responsible to the needs of three groups:
Issuers of securities
Investors
Market intermediaries
Functions:
Quasi-legislative – drafts regulations
Quasi-judicial – passes rulings and orders
Quasi-executive – conducts investigation and enforcement action
Powers:
To approve by−laws of Securities exchanges.
To require the Securities exchange to amend their by−laws.
Inspect the books of accounts and call for periodical returns from recognised Securities exchanges.
Inspect the books of accounts of financial intermediaries.
Compel certain companies to list their shares in one or more Securities exchanges.
