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Sebi meet next week to discuss market reforms

The board members of the Securities and Exchange Board of India (Sebi) are scheduled to meet in New Delhi on June 19 to discuss and enforce capital market reforms, including the Securities Laws (Amendment) Ordinance, 2014

The board members of the Securities and Exchange Board of India (Sebi) are scheduled to meet in New Delhi on June 19 to discuss and enforce capital market reforms, including the Securities Laws (Amendment) Ordinance, 2014. Among those on the board’s agenda are revamping the framework for equity public issuances, issuing new guidelines on prevention of insider trading, employee stock options and real estate investment trusts (REITs). The meeting assumes significance as it will be the first gathering after the new government assumed charge at the Centre.

Sources said the board may discuss the idea of extending the 25% minimum public shareholding norms to state-owned firms, which was applicable only to private companies. In addition, the board is also likely to discuss the idea of reserving 10% in offer-for- sale (OFS) issuances for retail investors, and whether or not to provide discount to retail participants as the move may benefit the government’s disinvestment programme.

Sebi officials noted that 36 active PSUs have public shareholding below 25% and these companies need to offload shares worth R57,922 crore, based on share prices on May 19. Coal India alone will have to offload shares worth R36,058 crore, nearly 60% of the total amount. Eight PSUs will have to sell shares worth more than R1,000 crore and 26 PSUs require to divest shares worth R500 crore. However, Sebi will consider relaxation of this norm on a case-to-case basis.

The regulator may extend the eligibility of OFS regulations to top 200 companies by market capitalisation from the current 100 companies. The board comprises seven members and includes Sebi chairman UK Sinha and Department of Economic Affairs’ secretary Arvind Mayaram.

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First published on: 13-06-2014 at 00:15 IST
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