IPO Advertisement rules to be changed - SEBI

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The latest news from SEBI is that the rules for IPO advertising are all set to change as the Securities Exchange Board wants it to be inline with the Red herring Prospectus for that IPO, currently many IPO's give advertisement which is false and misguides investors who are new to share markets.

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So we will now see a tightened set of guidelines for an Companies IPO which maches with the draft of the Red herring prospectus for the IPO. Thus helping the investors in knowing the true picture of the company whose IPO is being floated in market.

Hence merchant bankers should become careful and more responsive now onwards.

SEBI introduces pre-open call auction

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The Securities and Exchange Board of India (SEBI) said on Thursday it has decided to introduce the call auction mechanism in the pre-open session.

The pre-open session shall be introduced on a pilot basis by BSE and NSE for the components of benchmark indexes BSE-30 and NSE-50.

BSE to have separate exchange for SME'S and midsized companies

(posted under - SME exchange) - Bombay Stock Exchange has submitted a preliminary application to Securities and Exchange Board of India(SEBI) for setting up a separate exchange for small and medium-size enterprises.

Apart from the BSE, National Stock Exchange and MCX Stock Exchange (MCX-SX) have also shown interest in setting up such a platform for SMEs.

BSE updates - Change in listing norms by SEBI

(Under BSE updates) - The Securities Exchange Board of India popularly known as SEBI, which controls and governs the working of Indian share markets by making amendements in the trading and listing rules in all the stock markets of india whether regional or Bombay Stock Exchange(BSE), National Stock Exchange (NIFTY) has come up with another amendement in the listing norms of the companies on indian share markets.

The change in listing norms would protect the minority share holders in any listed company on all the authorised stock markets across india. SEBI's step will prevent situations wherein companies come out with follow-on issues, rights issues or preferential allotments with higher voting rights per share, helping promoters get greater control in the company. According to Sebi amendements in norms, firms can come up with fresh issues that offer inferior voting rights or dividend, thereby helping raise equity without resorting to debt and giving up control.

However it's still not clear how the indian share markets would react to this change in coming trading days

SEBI scraps no delivery period during Corporate announcements Events

To avoid volatility in markets, watchdog SEBI has done away with the practice of keeping shares under no-delivery during the record date for corporate announcements like bonus or dividend.

No-delivery period means that trading during the record date would not result in any delivery of shares.

However, this system was useful when trading used to take place in the physical form as certificates had to be delivered before record date starts to the registrars of companies.

However, the practice lost importance during the present days of demat or electronic trading.

"...it is decided to do away with 'no-delivery period' for all types of corporate actions in respect of the scrips which are traded in the compulsory dematerilaised mode," market regulator SEBI said in a circular.

Market analysts said the move will prevent market volatility.

"The announcement would prevent fluctuation in prices and it is good for the market," brokerage firm SMC Global Vice- President Rajesh Jain.

SEBI added the circular is issued to protect the interests of investors in securities and to promote and regulate the securities market and it would come into effect from August 1, 2009.

courtesy - economictimes

Share rule changes - approved by SEBI

The Securities and Exchange Board of India (SEBI) approved the "anchor investor" concept under which an investor can subscribe to up to 30 percent of the quota for institutional investors in an initial public offering, said Chairman C.B.Bhave.

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"This is in response to (the) requests of issuers that there was a need for investors with prior commitment who will enhance their ability to sell the issue and bring more confidence," Bhave told reporters after a board meeting.

Under the new rules, an anchor investor would pay 25 percent of the total investment at the time of applying for the initial public offering, and the balance within two days of the closure of the issue.

Such anchor investors would have to adhere to a lock-in period of one month from the date of the share allotment.

Earlier this year, the regulator amended rules for declaring the price band of initial public issues and changed its rules on mandatory open offers in a drive to make the capital markets more investor friendly.

Bhave said SEBI had also decided to rationalise disclosure in the rights issues offer documents as information relating to the listed company offering such an issue was already available in public domain for investors.

In a rights issue, a company issues new shares to existing shareholders. Analysts say the upturn in the stock market is expected to see many firms rushing to tap this route to raise finances for either cutting debt or to fund expansion plans.

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"The revised disclosure would make the process of rights issue faster for companies and also reduce overall costs for such issues," said a SEBI statement.

The market regulator also said entry load for investments in mutual funds would be removed, which is expected to result in increased participation. It would also cut registration fees for market intermediaries by about 50 percent.

courtesy - economictimes

SEBI to outline framework for REITs

Speaking to mediapersons after an interactive session with members of Bharat Chamber of Commerce in Kolkata on Thursday, Sebi chairman C.B. Bhave said: "The regulator is not averse to the idea of REITs. We may look at REITs at a later stage. But before that, the regulator would assess the workings of real estate mutual funds."

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Sometime in April 2008, Sebi had prepared norms for real estate mutual fund. But the launch of real estate MF was delayed due to market meltdown. Incidentally, REITs is a trust that uses the pooled capital of many investors to purchase and manage real estate assets and/or mortgage loans.

REITs are traded on major stock exchanges like normal stocks. There are three type of REITs popular in USA and in other advance economies namely equity REITs, mortgage REITs and hybrid REITs.

According to Mr Bhave, the main hindrance for introducing REIT like products in India is lack of transparency in the real estate market, variable stamp duties in different states and absence of uniform price of land and properties across India.

"We have already spoken to the union government to bring about a uniformity in stamp duties across states but it would obviously take sometime," he added.

Commenting on the transparency in different investment avenues, Mr Bhave said that the regulator is also working on new guidelines for portfolio management schemes (PMS).

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"We want to ensure that a PMS client gets to know his exact asset portfolio directly through depository participants independent of the portfolio managers. This is essential to infuse credibility in the PMS system," he said.

Earlier addressing Bharat Chamber of Commerce members, Mr Bhave said that the regulator is working on new delisting guidelines. Though it will take sometime, Sebi want to ensure that the retail investors are not left in the lurch.

SEBI asks cos to declare dividend on a per share basis

(25/4/2009 - Indian Market Updates)  - SEBI on Friday reduced the timelines for the notice period by listed companies for all corporate actions like dividend and bonus, to name

a few. The notice period for the record date has been brought down to seven working days while that for board meetings has been reduced to two working days. It has also introduced a uniform procedure for companies in dealing with unclaimed shares. The new clause relates to those shares that could not be allotted to the rightful shareholder due to insufficient information.

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“It has been brought to the notice of the board that there is a large quantum of shares issued pursuant to the public issues, which remain unclaimed despite the best efforts of the registrar to issue or issuers, and that there is no uniform practice for dealing with such shares,” the release said.

The unclaimed shares will be credited to a demat suspense account opened by the issuer with one of the depository participants and any corporate benefit, such as dividend, bonus shares, will also be credited to such account. The allottee’s account will be credited as when he/she approaches the issuer, after undertaking the proper verification of identity. The voting rights of these shares will remain frozen till the rightful owner claims the shares. The details of the shares in the suspense account will be disclosed in the annual report.

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In order to bring about uniformity in the manner of declaring dividend among listed companies, Sebi has made it mandatory for companies to declare their dividend on a per share basis only. This means that irrespective of the face value of the share, the company will have to mention the dividend on an absolute basis.

posted under - SEBI, SEBI news, indian markets news, bse news, nse news and views, Security exchange board of india, SEBI
source - www.economictimes.com

SEBI increases upfront margin on warrants to 25%

The Securities and Exchange Board of India has decided to increase the upfront margin to be paid by allottees of warrants to 25 per cent from 10 per cent earlier.

The markets regulator also decided to relax the pricing norms regarding Satyam Computer, after its board examined a request for exemption of certain provisions of takeover regulation. This was done within the general context.

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SEBI has also shortened the timeframe for announcing the price band for an initial public offering to just two days against the present requirement of two weeks.

The timeline for announcement of bonus share issue has also been reduced to 15 days from 30 days earlier. Further, a company declaring the bonus issue would not require approval from the shareholders.

On dividend, SEBI said, listed companies will have to announce dividend on per share basis and not on percentage of face value of the share, as the face value may differ and mislead investors.

posted under - SEBI updates, BSE updates, BSE stocks, SEBI, SEBI news
source - www.economictimes.com