Sebi Accelerates Rights Issue Processing Times to 23 Days

Sebi has shortened the rights issue processing time to 23 days and added flexibility by allowing specific investor allotments. The filing requirement with the regulator has shifted to stock exchanges for quicker approvals. These measures aim to streamline the fundraising process for listed companies.

India's markets regulator, Sebi, announced a reduction in the processing time for rights issues of equity shares to 23 days, aiming to make it a more attractive fundraising option. Market observers view this as a step towards facilitating business ease and encourage more efficient capital raising.

Alongside this, the requirement to file a draft offer with Sebi will be replaced by filing with stock exchanges, providing greater flexibility in the allotment of shares to specific investors. Current timelines for rights issues average 317 days, but the new measures promise completion within 23 working days from board approval.

Sebi's move will enable existing shareholders to engage more significantly with potential future growth. The rights issue framework will remain open for a minimum of seven days, with automated application validations set for implementation within six months. The regulator also mandates a 'monitoring agency' to oversee the proceeds' utilization, aiming to bolster issue transparency and efficacy.

(With inputs from agencies.)