Primary markets are extremely important for us, says SEBI Chief

To support that pipeline, SEBI approved changes to ease IPO requirements and extend timelines for companies to meet minimum public shareholding (MPS) rules. Large issuers will now be allowed to launch smaller IPOs initially, with longer periods to reach the 25% public float.

“Primary markets are extremely important for us. It is important from the point of view of capital formation, but also because we are seeing a lot of flows through mutual funds and domestic investors, and hopefully FPI flows will also come in,” SEBI Chairperson Tuhin Kanta Pandey said on Friday after the board meeting. “There are lots of primary issuances coming, but we need more—and good quality—issues to come.”

To support that pipeline, SEBI approved changes to ease IPO requirements and extend timelines for companies to meet minimum public shareholding (MPS) rules. Large issuers will now be allowed to launch smaller IPOs initially, with longer periods to reach the 25% public float.

For companies with a post-issue market cap of ₹50,000–1,00,000 crore, the minimum public offer has been revised to ₹1,000 crore plus 8%, with 25% MPS compliance required within 5 years. Firms worth ₹1–5 lakh crore will need to raise at least ₹6,250 crore plus 2.75%, and if their initial float is below 15%, they must reach 15% in 5 years and 25% in 10 years. For mega issuers above ₹5 lakh crore, the threshold is ₹15,000 crore plus 1%, subject to a minimum dilution of 2.5%, with the same extended compliance timelines.
SEBI also said the new timelines will apply to listed companies that are still short of MPS, providing parity with fresh issuers.

“We would like retail investors to invest in large market-cap stocks and participate in the wealth creation,” said SEBI Whole-Time Member Kamlesh Varshney.