This will ensure that issuers have faster access to the capital raised, thereby enhancing the ease of doing business, the market regulator said
Market regulator the Securities and Exchange Board of India (SEBI) on June 28 said it will reduce the listing timeline after an initial public offering (IPO) to three days after the closure of the issue from the present T+6 at present. ‘T’ is the day the issue closes for the subscription.
“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,” SEBI said.
This will ensure that issuers have faster access to the capital raised, thereby enhancing the ease of doing business, and the investors have an opportunity for early credit and liquidity of their investment, the market regulator said.
The decision comes after extensive back-testing and simulations by all stakeholders, including stock exchanges, sponsor banks, NPCI, depositories and registrars, in respect to various activities involved in the public issue process.
In the existing timeline, the registrar finalised the basis of allotment and submitted it to the designated stock exchange for approval on T+3. In the new timeline, this will be done on or before 6 PM on T+1.
Earlier, the issuer made a listing application to stock exchanges for trading permission on T+5. Now, this will be done on or before 6:30PM on T+2.
In 2018, SEBI introduced Unified Payment Interface (UPI) as an additional payment mechanism with Application Supported by Blocked Amount (ASBA) for retail investors and prescribed a listing timeline of within six days of closure of the offer.
Prior to that, the listing timeline was as far as 22 days, which was shortened to 12 days.
