SEBI eases listing norms for startups
Understanding the role of startups in economic development of the country and challenges these companies face in early days while securing initial capital for expansion, The Securities and Exchange Board of India (Sebi) on Thursday eased eligibility and listing criteria on the so-called Innovators Growth Platform (IGP), a separate exchange venue for new-age startups. At present, for a company to be able to list on IGP its 25 per cent pre-issue capital needs to be held for at least two years by an institutional investor and other large investors. Sebi has eased this requirement to just one year.
Also, up to 25 per cent of pre-issue shareholding of ‘accredited investors’ –an individual investor with net worth of Rs 5 crore—will allowed for the above eligibility criteria. Earlier, a maximum of 10 per cent of pre-issue holding of accredited investors’ was considered for the 25 per cent pre-issue eligibility requirement.
Introduced in 2019, IGP is aimed providing technology-oriented startups or companies with early-stage investors a listing opportunity with a much more relaxed framework compared to the mainboard. The platform is yet to see any listing.
