The circular issued today directed the stock exchanges and depository institutions to inform all stakeholders about this, while setting up the necessary systems and infrastructure for monitoring and implementation of the new norms.
Subscribe to rights issued shares and validation of application bids received for the final determination of the basis of allocation is also carried out by them along with the registrar in question.
Additionally, a system for automated verification of applications by investors must be developed within six months of the date of applicability of this circular.
Circular also specified that rights issues remain open for a minimum of 7 days and a maximum of 30 days of subscription.
The regulations for this circulation will come into effect from April 7, 2025. If the issuer issuing the rights to convertible debt certificates that require shareholder approval, the second notice of the board for the purpose of amending the record date will receive the approval of the shareholder approval. The due diligence process has been completed and the preparation of the Offer Letter (DLOF)/Offer Letter (LOF) by MBS has been extended.
In a consultation paper published in August 2024, Sebi wanted suggestions on reducing the timelines included in the process. This issue was placed before the Key Market Advisory Committee (PMAC) at a meeting held on July 22, 2024 for consideration and recommendations.
The consultation paper reviewed the role of intermediaries involved in the rights issuing process, invited feedback on many other issues, including reducing the timeline involved in the process, allowing for allocation to selective investors, and reducing appropriate checks and balance.
According to SEBI data, in FY24, Rs 15,110 was raised via 67 rights issues. FY23 and FY22 raised crores 6,751 crores and 26,327 rupees via issues 73 and 43 respectively.
Companies were able to raise significantly more volumes through QIP and preferred allocation of stocks. In fiscal 2024, the company won 68,972 via the QIP route and raised Rs 45,155 with a priority allocation.
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