New Delhi: The Securities and Exchange Board of India (SEBI) has proposed major changes to its regulatory framework, aiming to simplify large initial public offerings (IPOs) while stepping up action against unregistered financial influencers and advisors.
SEBI Whole-time Director Kamlesh Chandra Varshney said a consultation paper has been released to extend the deadline for achieving 25 per cent public shareholding to 10 years for exceptionally large companies. At present, companies are required to meet this threshold within five years of listing. He said this move will make large IPOs, including that of the National Stock Exchange, more practical.
Varshney added that SEBI is advising merchant bankers and anchor investors to adopt “realistic and conservative valuations” in IPOs to avoid post-listing price erosion that could dent retail investor confidence.
Alongside easing rules for large listings, the regulator is intensifying its crackdown on unregistered investment advisors and financial influencers who mislead investors through social media platforms.
SEBI has tied up with Meta to run an advertisement verification system to ensure only registered entities can promote market-related content. Discussions are also underway to expand the process to other digital platforms. A dedicated SEBI monitoring team is flagging illegal posts to Google and Meta, which Varshney said are now taken down within hours.
He added that enforcement actions are being carried out against violators, including TV experts and penny stock manipulators. “SEBI has no objection to genuine ‘educators’ but will act against those who, under that guise, provide unregistered trading advice or lure investors with false promises,” he said.
SEBI is also pushing forward with investor awareness campaigns. Varshney said the regulator is taking investor education to the “next level” with outreach programmes in universities and schools to equip people with tools to make informed investment choices and distinguish between genuine advisors and fraudsters.
BI Bureau
