SEBI grants one-time extension for IPO approvals as West Asia conflict hurts market sentiment

Mumbai: India markets regulator on Tuesday granted a one-time extension for approved public offers that are being deferred due to weak market sentiment as a result of the Middle East war, which has entered the sixth week.

The relief will apply for companies whose regulatory approval will lapse between April 1 and September 30, the Securities and Exchange Board of India said, extending it to until September 30.

India mandates that companies must go public within 12 to 18 months of regulatory approval.

The regulator said exchanges will not penalize companies that cannot meet the requirement of having a minimum of 25% shares with the public. This leeway will also be until September 30.

Similar extensions were given during the COVID-19 pandemic.

The relaxations follow requests from market participants as the war and the resultant market volatility have led several firms to defer or withdraw share issuance plans.

Regulatory clearances of about 40 companies planning to mobilise capital to the tune of 435 billion rupees ($4.68 billion) would have lapsed by September 30, data from information provider Prime Database showed.

“The extension enables issuers to better assess market conditions and strategically time their IPO launches amid heightened volatility and subdued sentiment,” Mahavir Lunavat, chairman of Association of Investment Bankers of India, said.

($1 = 92.9580 Indian rupees)

(Reporting by Jayshree P Upadhyay; Editing by Mrigank Dhaniwala and Arun Koyyur)

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