CS Tejpal Sheth’s Post

*SEBI PROPOSES CHANGES IN NORMS FOR SME IPOS* PROPOSES TO RAISE MINIMUM SUBSCRIPTION FOR SME IPOS TO 200,000 RUPEES FROM 100,000 RUPEES || SEBI - PROPOSED MINIMUM ALLOTTEES IN SME PUBLIC ISSUE MAY BE INCREASED TO 200 - CONSULTATION PAPER PROPOSES CHANGES TO ALLOCATION METHODOLOGY FOR NON INSTITUTIONAL INVESTORS IN SME IPOS || SEBI PROPOSES RESTRICTING ‘OFFER FOR SALE’ COMPONENT IN SME IPOS TO 20% OF ISSUE SIZE - CONSULTATION PAPER PROPOSES TIGHTER MONITORING OF USE OF FUNDS FOR ISSUES MORE THAN 200M RUPEES || SEBI PROPOSES MINIMUM ISSUE SIZE OF 100 MLN RUPEES FOR SME IPOS SEBI PROPOSES THAT FEES TO MERCHANT BANKERS BE DISCLOSED IN PROSPECTUS FOR SME IPOS - CONSULTATION PAPER

SEBI Board Approves Stricter Norms for SME IPOs The much-awaited stricter norms for SME IPOs come in response to recent governance issues with SME IPOs and listings. SEBI’s revised guidelines introduce much-needed governance reforms, enhancing transparency, investor protection, and paving the way for sustainable growth for SME-listed companies. Key Highlights: 1️⃣ SMEs need ₹1 crore EBITDA in 2 of 3 preceding years to file for IPOs. 2️⃣ Shareholder Offer for Sale (OFS) capped at 20% of the issue size, with a 50% holding limit per seller. 3️⃣ Phased promoter lock-in: 50% released after 1 year, remaining after 2 years. 4️⃣ NII allocation methodology aligned with main board IPOs. 5️⃣ General Corporate Purpose (GCP) capped at 15% or ₹10 crores, whichever is lower. 6️⃣ No use of proceeds for promoter/related party loan repayments. 7️⃣ DRHP open for 21-day public comment with QR code access. 8️⃣ Further issues allowed without migration to the main board, subject to LODR compliance. 9️⃣ Related Party Transaction (RPT) norms extended with stricter materiality thresholds (10% turnover or ₹50 crores). #SEBI #SMEIPO #CorporateGovernance #InvestorProtection #CapitalMarket

SEBI’s Game-Changing Reforms for SMEs On December 18, 2024, SEBI announced key amendments to the SME framework under SEBI (ICDR) Regulations, 2018, and SEBI (LODR) Regulations, 2015. These reforms aim to strengthen SME public issue frameworks, ensure investor protection, and foster growth. #SME #SEBI #ICDR #Regulations #CorporateGovernance #InvestorProtection #Growth #Finance #IPO #Cokaco

On December 18, 2024, SEBI announced key amendments to the SME framework under SEBI (ICDR) Regulations, 2018, and SEBI (LODR) Regulations, 2015. These reforms aim to strengthen SME public issue frameworks, ensure investor protection, and foster growth. I believe these changes will protect retail investor’s interest and good companies to hit exchanges. Before and in after maths of covid; SME Exchnage has proved vital for Small Businesses to raise capital for growth who until then was debt dependent. Pro vigilance of SEBI is vital for investor interest. #SMEIPO #SME #SEBI #SMALLBUSINSSES #IPO

SEBI Board approves SME IPO norm changes; mandates ‘Rs. 1 crore’ operating profit in 2 of 3 preceding years for DRHP filing PR No.36/2024, Dated: 18.12.2024 SEBI, in its 208th Board Meeting, approved several amendments to regulations, including measures to enhance ease of doing business related to Business Responsibility & Sustainability Reporting, a review of the SME framework under ICDR Norms, a review of Merchant Bankers Regulations, etc.

Sebi issues consultation paper to review SME IPO and disclosure norms 1. Capital market regulator Sebi has come out with a consultation paper to review the listing framework of Small and Medium Enterprises (SME), suggesting an increase in the minimum application size to Rs 2 lakh per application. 2. Another proposal by Sebi suggests changing the allocation methodology for non-institutional investors, wherein the proportionate allotment for the NII category may be discontinued and “draw of lots” allotment be introduced, as is applicable for the retail category. 3. The Sebi consultation paper has also proposed to limit the 'Offer For Sale' portion in the SME public issue to 20% of the total issue size. 4. Under the existing method, there is a requirement for SME issues to be considered successful there should be minimum of 50 allottees in the public issue. Sebi proposes to suggest that this requirement of minimum allottees in public issue be raised to 200.

🚀 Strengthening the Future of SME IPOs: SEBI's Key Proposals for Reform! 🚀 SEBI is reviewing the SME segment framework to enhance governance, transparency, and investor protection. The latest Consultation Paper includes crucial proposals that could reshape SME IPOs and listing practices. 🔑 Key Proposals: 1. Higher Investor Safeguards: Minimum application size may rise from ₹1 lakh to ₹2-4 lakh, ensuring only informed, risk-tolerant investors are part of the process. Non-Institutional Investor (NII) allocation and allotment methods to be revised for fairness and greater institutional participation. 2. Corporate Governance Overhaul: Stricter Related Party Transaction (RPT) norms to prevent fund misuse. Quarterly disclosures on financials and board activities, aligning with Main Board standards. 3. Enhanced Listing Criteria: Proposals to increase minimum allottees in SME IPOs from 50 to 200, fostering liquidity. Offer for Sale (OFS) capped at 20%, ensuring SME IPO funds serve growth rather than promoter exits. 4. Post-Listing Monitoring: Mandatory Monitoring Agencies for issues above ₹20 crores, ensuring transparency and accountability. 5. Stronger Eligibility for IPOs: New criteria for financial performance and promoter integrity ensure only viable businesses access public capital. 📊 SME Segment Growth Surge: SME IPOs have exploded in recent years, raising over ₹6,000 crores in FY 2023-24. However, challenges like fund diversion and minimal post-listing trading remain. Your voice matters! 📣 SEBI is inviting public comments on these proposals till December 4, 2024. Let’s shape a transparent, efficient, and robust SME ecosystem for the future. #SMEIPO #SEBI #CapitalMarkets #InvestorProtection #CorporateGovernance #India #SMEReforms #SEBISME #Investors #MarketTransparency

Is SME IPO's are Buble ? The SEBI has proposed several enhancements to the SME IPO framework to address concerns about market misconduct and to ensure better investor protection. Some of the key proposals include: 1) Increase in Minimum Application Size: SEBI suggests increasing the minimum application size for SME IPOs to Rs 2 lakh per application. 2) Lock-in Periods: Introduction of a mandatory lock-in period of 15 days for all IPO investors to deter speculative trading. 3) Accredited Investors: Restricting SME IPO participation to accredited investors with specific net worth and income criteria. 4) Enhanced Disclosure Requirements: Companies must provide more detailed disclosures, including merchant banker fees and due-diligence certificates. 5) Profitability Threshold: Introduction of a profitability threshold for SME IPO eligibility. 6) Corporate Governance: Stricter corporate governance norms, including mandatory quarterly reporting of financial disclosures and board composition. These proposals aim to create a more transparent and investor-friendly SME IPO market while ensuring that funds raised are used for genuine business growth rather than speculative gains. #investorsprotection #finance #sme #fundraising #sharemarket #sebi #ipo #market #sensex #nifty #awareness #investment #nifty #investors #talkaboutfinance #investment #funds #fundraising

SEBI has introduced significant reforms to strengthen the SME IPO framework, ensuring robust corporate governance and enhanced investor protection. Key amendments approved in the SEBI Board Meeting on December 18, 2024, include: SMEs must have an operating profit of ₹1 crore in 2 of the last 3 years for IPO eligibility. Offer for Sale (OFS) capped at 20% of the issue size, with shareholders restricted to selling a maximum of 50% of their holding. Lock-in on excess promoter contribution to be released in phases over 2 years. Alignment of allocation methodology for Non-Institutional Investors (NIIs) with Main Board IPOs. General Corporate Purpose (GCP) allocation capped at 15% or ₹10 crore, whichever is lower. Issue proceeds cannot be used for loan repayment to promoters or related parties. DRHPs to be open for public comments for 21 days, with enhanced accessibility via QR codes. Further issues allowed without Main Board migration if Main Board LODR norms are followed. Related Party Transaction (RPT) norms extended to SMEs, with materiality thresholds set at 10% of turnover or ₹50 crore. These updates aim to encourage credible SMEs to raise funds while protecting investors. consult expert 1:1 for more information & advisory contact@bizstreet.biz #SEBI #SMEIPO #InvestorProtection #CorporateGovernance #StockMarket #IndiaEconomy #FinancialReforms #Bizstreet

📊 SEBI's New Consultation Paper! 🌟 SEBI has issued a consultation paper to review the SME IPO and disclosure norms. 📃 Proposed changes include increasing the minimum application size to Rs 2 lakh and the number of allottees to 200 for a successful issue. 📈 These measures aim to enhance transparency and protect investors. 🛡️ #SEBI #SMEIPO #Investment #Transparency