SEBI is contemplating the introduction of a “when-listed” platform that would allow market participants to trade in companies that have concluded their IPOs but are yet to list on the stock exchanges. SEBI Chair Madhabi Puri Buch mentioned at an event in Mumbai that the current system of waiting three days from the closure of an IPO to listing could be utilized for trading and should be properly regulated.
Typically, companies are listed on the exchanges within three days of the closure of their IPOs. Pre-listed shares, which are allocated but not yet listed, are usually traded in the grey market to determine the potential listing premium or discount. Establishing a formal exchange platform for trading these shares could eliminate the need for informal channels like the grey market.
SEBI is also working on simplifying the IPO offer document. The regulator is aiming to standardize the format for IPOs with provisions for exceptional reporting. This move is expected to streamline the preparation and examination of the document, benefiting both bankers and the regulator.
Overall, these initiatives by SEBI are geared towards enhancing transparency and efficiency in the IPO process while providing investors with a more regulated platform for trading pre-listed shares.
