- This decision has been taken because some large institutional investors and high net worth individuals were putting in bids only to inflate the subscription numbers and not to get allotments.
- Now the IPO applications should only be processed if there are supporting funds in an investor's bank account.
- In addition to it, stock exchanges shall accept the ASBA applications in their electronic book building platform only with a mandatory confirmation on the application monies blocked.
- This rule will apply to all categories of investors including retail, qualified institutional buyers (QIBs), non-institutional investors, and other reserved categories.
- It will affect Public issues which are opening on or after 1st September.
- Apart from that Sebi planning to cancel recent IPOs as bidders didn't have sufficient funds in their bank accounts.
Question:
Q.1 As per the SEBI circular the new rules for IPOs will affect from which the following date on all public issues?a. 31st August
b. 1st September
c. 1st October
d. 31st October
