 "Sebi speeds up IPO clearing process")
The Securities and Exchange Board of India (Sebi) has issued its first observation on the proposed Rs 1,150-crore Initial Public Offer (for equity) of Coffee Day Enterprises.
This has come within three weeks of the country’s largest chain operator in this segment filing the offer document. Sebi is presently aiming to infuse more life into the moribund IPO market and is hastening the clearance process.
The market regulator has taken an of average 70 days to issue its final observations on the Draft Red Herring Prospectus’ filed in the first half 2015. In comparison, it took nearly 120 days to give these on offer documents filed with it a year before.
It should be noted, though, that the delay is may a time also due to delay on the issuer’s part in responding to Sebi’s queries.
“Sebi has been speeding up its clearing process. If there is a need for clarification, it is being sought at the earliest,” said a source. Others say Sebi has reshuffled its corporate finance division to ensure smoothening of the process.
Some marquee names are in the line for an IPO nod. These include InterGlobe Aviation, owner of India's biggest airline, IndiGo. GVK Airport Developers, which operates the airports at Mumbai & Bengaluru, plans to file offer documents soon.
“Sebi has been very pro-active lately in clearing offer documents. Overall, the process has become much faster than in the past,” said an official with a leading investment bank, asking not be named.
ALSO READ: Sebi conducts FMC officials' interviews
Despite a sharp rally in the equity market last year, capital raising via IPOs was subdued. In 2014, only six companies raised money (Rs 1,800 crore in all) by way of IPOs on the two major exchanges, even as the benchmark indices rose 30 per cent. So far this year, the trend hasn’t changed much. Around Rs 1,700 crore has been raised via five IPO deals so far in 2015.
This has come within three weeks of the country’s largest chain operator in this segment filing the offer document. Sebi is presently aiming to infuse more life into the moribund IPO market and is hastening the clearance process.
The market regulator has taken an of average 70 days to issue its final observations on the Draft Red Herring Prospectus’ filed in the first half 2015. In comparison, it took nearly 120 days to give these on offer documents filed with it a year before.
It should be noted, though, that the delay is may a time also due to delay on the issuer’s part in responding to Sebi’s queries.
“Sebi has been speeding up its clearing process. If there is a need for clarification, it is being sought at the earliest,” said a source. Others say Sebi has reshuffled its corporate finance division to ensure smoothening of the process.
Some marquee names are in the line for an IPO nod. These include InterGlobe Aviation, owner of India's biggest airline, IndiGo. GVK Airport Developers, which operates the airports at Mumbai & Bengaluru, plans to file offer documents soon.
“Sebi has been very pro-active lately in clearing offer documents. Overall, the process has become much faster than in the past,” said an official with a leading investment bank, asking not be named.
ALSO READ: Sebi conducts FMC officials' interviews
Despite a sharp rally in the equity market last year, capital raising via IPOs was subdued. In 2014, only six companies raised money (Rs 1,800 crore in all) by way of IPOs on the two major exchanges, even as the benchmark indices rose 30 per cent. So far this year, the trend hasn’t changed much. Around Rs 1,700 crore has been raised via five IPO deals so far in 2015.
Sebi has also been taking other steps to infuse life into the primary market. It has held meetings with investment banks and issuers to understand the issues preventing them from coming to the market. Also, it has been easing some primary market norms— allowing doubling of the anchor investor quota, for instance— to facilitate smoother capital raising.
CLARIFICATION
An earlier version of this article had mentioned that the public issue size of the Coffee Day IPO was Rs 1,100 crore instead of Rs 1,150 crore. The error is regretted.