IPO pipeline strong; easier disclosure norms helped: UK Sinha

Moneycontrol Bureau

An improving economy and the market regulator’s focus on raising disclosure norms have benefited the IPO market, says SEBI Chairman UK Sinha.

"When I look at the scenario in our country I am finding that the number of issuances in the last 3 years and the amount raised is going up in a very healthy manner," said Sinha at Association of Investment Bankers of India Summit held in Mumbai today.

He further added that the IPO pipeline is strong as the total 11 draft red herring prospectus (DRHPs) are pending with SEBI currently.

"The total number of DRHPs pending with us is 11 out of which none are more than 2 months. Those are pending because another judicial clearance is required," Sinha said.

He further added that SEBI has brought better transparency for unlisted companies and helped them raise funds through private placements.

Sinha also expressed concerns about IPO issues trading below the issue price.

Prior to 2013 more than two-third issuances were continuously trading below the issue size, Sinha said.

In FY17, 17 out of 25 issuances are trading above their issue price.

The remaining 8 issues were oversubscribed during its initial public offering but are still trading below the issue price, concerned Sinha said.

Sinha said that several NRIs are looking at India as a destination for IPOs due to good economic growth and transparent disclosure norms.

He further said none of the start-ups have been listed so far adding that he is willing to amend the changes in the listing norms.

On the SME front, Sinha said financing for the sector has seen good success and almost 200 companies have got listed in both NSE and BSE and another 200 companies are lining up for listing.