Sebi increases issue document review in response to an increase in IPO activity in the market: Reports

According to news agency Reuters, the Securities and Exchange Board of India (Sebi) is intensifying its review of filings made by businesses looking to go public.

The action by India's market regulator coincides with a discernible rise in initial public offerings (IPOs) in the country.
First among the four sources cited in the report, "the regulator has returned at least six public offer documents, as Sebi observed companies are misleading in their reasons for fundraise," stated the source.

First among the four sources cited in the report, "the regulator has returned at least six public offer documents, as Sebi observed companies are misleading in their reasons for fundraise," stated the source.

Due to the increase in activity on the Indian stock market, around 50 companies will make their initial public offerings in 2023 alone. Eight initial public offerings (IPOs) have been finished this year, while 40 more are pending Sebi clearance.

Notably, the promoters and significant shareholders who play significant roles in the company would have their shares locked in for a period of eighteen months if monies were set aside for debt reduction.
Nevertheless, the lock-in period is extended to three years if the money is meant for capital expenditures.
"By saying the company is using funds to retire debt, they (promoters) are circumventing the law and reducing the share lock-in period from three years to 18 months," stated the initial speaker.