Prithvi Haldea, chairman and managing director, Prime Database welcomes the changes announced with regards to retail investors and mutual funds by market regulator, SEBI today.
SEBI has decided to introduce a new short and simple form for IPO investors aimed at increasing retail participation in the stock markets. According to Haldea, the new IPO form will remove all the irrelevant information. It will ensure that investors get access to all the critical information which otherwise wasn't available. Below is the verbatim transcript of Haldea's interview with Menaka Doshi of CNBC-TV18. Also watch the accompanying videos. Q: What do you make of the several changes announced today with regards to retail investors and mutual funds? A: I will start off with the new IPO form because I was a part of this process. It is a very welcome development that the board has accepted the recommendation of a committee which was setup. The whole idea started from the point of view that we are in a disclosure based regime and we want investors to take informed decisions. But are we at least providing them with the information in a manner and format which makes it convenient to go through and then take a decision? If you look at the present abridged prospectus which the retail investor gets there is too much of information. The order of information is messed up and we are therefore in a way ensuring that the retail investor is not reading and investing. The whole idea of new IPO form is to cut out all the irrelevant information, bring in some additional relevant information and change the order of information. Now the form starts with the details of the promoter and not with how to apply and where to apply. The track record of the promoter comes first, then about the company, the project, the means of financing and then risk factor. The risk factor shouldn't be mentioned right in the beginning because unless I understand the business how do I understand the risk factor? So there is an attempt to change the entire order of information. At least a form has been made which is not just an application form but also abridged prospectus which is attached to it. They have made it much more readable and going forward the investors cannot complain that they donDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
