The move follows representations requesting Sebi to consider relaxing its regulations to enable employees to apply for shares beyond the limit of Rs 2 lakh per employee.
Besides, Sebi was also requested to allow under- subscription in the employee reservation portion to be allotted to employees over and above the extant limit of Rs 2 lakh on a proportionate basis.
Under the Sebi (Issue of Capital and Disclosure Requirements) Regulations, also known as ICDR Regulations, an issuer can make reservation for employees which can not exceed 5 per cent of the post issue capital of the issuer.
At a board meeting held here today, Sebi approved a proposal to allow allotment to employees in excess of the extant limit of Rs 2 lakh per employee under employee reservation quota.
"The application for shares of the value in excess of Rs 2 lakh shall be considered as application for additional shares and shall be considered only in the event of under- subscription in the employee reservation portion.
"The unsubscribed shares available in the employee reservation portion shall be allotted on a proportionate basis to the employees who have applied for the additional shares. Value of total allotment to an employee under the employee reservation portion, including the additional allotment shall not exceed Rs 5 lakh," Sebi said.
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