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Sep 28, 2012 10:11 PM IST | Source: CNBC-TV18

Sebi tightens IPO pricing norms

Today Sebi has taken another step to bring-in self discipline in IPO pricing. The regulatory board came out with discussion paper on mandatory safety net mechanism, the mechanism, which could help in protecting the interests of small investors.

Sebi tightens IPO pricing norms

Today, Sebi has taken another step to bring-in self discipline in IPO pricing. The regulatory board came out with discussion paper on mandatory safety net mechanism, the mechanism, which could help in protecting the interests of small investors, reports CNBC-TV18.

The board has kept safety net provisions mandatory for all the IPOs, and provision will trigger only in cases where price of the shares depreciate by more than 20% from the issue price. The total obligation on safety net provider will be capped at 5% of the issue size.

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