SEBI has announced the implementation of new rules for IPO. According to the circular, the new rules will come into effect from December 1, 2023. In SEBI parlance, T Day is the IPO closing date, which means that after the implementation of the new rules, the IPO will have to be listed within 3 days of the issue closing date.
This rule is applicable on voluntary basis for IPO listing from September 1, 2023. However, now from December 1, 2023, all companies will have to compulsorily list their shares on the exchanges within three days of the closure of the issue.
Why the rules changed – The purpose of reducing the listing time limit is to benefit both companies and investors. Shorter listing time means that companies will get the capital raised through IPO sooner than before and investors will also benefit by getting their securities within the stipulated 3 days. Apart from this, those subscribers who were not allotted shares will also get their money back soon.
Under the new guidelines, companies will have to finalize the allotment within one day of closure of the issue, which means T+1 day. Unsuccessful applicants i.e. those who were not allotted shares will be refunded their invested money within T+2 days.
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