The Securities and Exchange Board of India (SEBI) has proposed reducing the time between initial public offerings and company share listings. Under the plan, the listing period would be shortened from six days to just three, offering advantages for both companies issuing shares and investors.
Presently, non-institutional investors can submit applications until 4pm on the closing day (T-day), while other investors have until 5pm. However, bank cut-off times are inconsistent; some shut as early as 11am on the closing day. The proposal suggests a new, uniform timeline of 1pm for physical applications.
The proposal also recommends a convenient timeline of 4pm on the closing day for electronic applications.
For syndicate applications processed through the Unified Payments Interface (UPI) via sponsor banks, the bid book of the stock exchange will only include applications with fully-blocked amounts, confirmed by investors’ acceptance/authorisation of UPI mandates in real-time.
The proposed uniform timeline of 4pm aims to facilitate UPI applications on both the stock exchange and for electronic transmission to investors’ mobile apps.
Under the proposal, scrutiny of third-party investors’ applications must commence before the closing date. Additionally, banks should submit confirmation of blocked funds to the registrar on the closing date.
