SEBI reduces IPO listing timeline to T+3 from T+6

The Securities and Exchange Board of India (SEBI) on Wednesday revised IPO listing timeline to three days from existing six days.

According to SEBI, this move will benefit issuers would receive securities in shorter period along with those who have not been allotted securities as they will get their money back faster. This move is also expected to restrict kerb trading.

"The revised timeline of T+3 days shall be made applicable in two phases i.e. voluntary for all public issues opening on or after September 01, 2023 and mandatory on or after December 01, 2023," said the market regulator after its board meet in Mumbai.

In the existing six-day process, the registrar finalises the basis of allotment in T+3 which shall now be revised to T+1, on or before 6 pm.

According to SEBI, this move has been made consulting with all stakeholders including anchor investors, registrar, transfer agents, broker-distributors, banks and after stress test, it has been confirmed to be smooth.

This move will also ensure resources of stakeholders like banks, stock exchanges, brokers will be deployed for a shorter period, SEBI said.

SEBI chairperson Madhabi Puri Bach explained this step at a press conference held after the board meet. She said: "This move ensures the whole process is quicker, as issuers get their money, those who don't get alotted get their money back and at the end of day, time is money. So, this move saves time and money."

Buch said the decision to reduce the listing time to three days is a "global first and I am sure it will also be glitchless as all market participants have tested its applicability".

SEBI also mandated additional disclosure requirements for foreign portfolio investors and introducing board nomination rights for unitholders of InvITs and REITs.

The watchdog will enhance disclosure requirements for FPIs, including mandating additional granular-level disclosures regarding ownership, economic interest and control of objectively identified FPIs meeting certain criteria and conditions.

Besides, SEBI said it will strengthen the investor grievance handling mechanism through SCORES and linking the new platform with the Online Dispute Resolution Mechanism.