With IPO market dried up, SEBI asks bankers to price it right - Indian IPO Blog

Tuesday, December 18, 2018

With IPO market dried up, SEBI asks bankers to price it right

The capital markets regulator Sebi on Tuesday voiced concern over the slow pace of primary issues, despite a good market condition, and asked investment bankers to do more "diligence" on the pricing front to get investors in. Chairman Ajay Tyagi said Sebi has given the go-ahead to initial public offers (IPOs) worth over Rs 60,000 crore in 2018, but many of them are yet to hit the street. Till October end, 24 companies raised Rs 30,959 crore through IPOs but most this been in the March quarter.

Last year was the best in terms of IPO fund raising, as the IPO market jumped to an all-time record of Rs 67,147.4 crore in fresh fund raising by over 120 companies, according to data from Prime Database.

When asked if the issue is pricing, he asked i-bankers to do more "diligence" while setting a price that will be acceptable to both the issuers as well as investors.

"Merchant bankers have a role to see that an issue is reasonably priced and which is acceptable to both issuers and investors," Tyagi said.

The Sebi chief seemed to suggest that domestic market conditions are better as compared to global peers, with firm macroeconomic fundamentals and said the rupee fall has also been arrested.

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