With the Securities and Exchange Board of India (SEBI) amending the ''disclosure
and investor protection guideline 2000'', it has been made easier for government-owned
infrastructure companies to raise funds through IPOs by doing away with the mandatory
one-year lock-in requirement of pre-issue share placements.
move will help government companies such as PSUs, statutory authorities and special
purpose vehicles (SPVs) set up by them to raise capital for their infrastructure
to the SEBI, infrastructure sectors would include transportation, agriculture,
water management, telecommunications, industrial and commercial development, power,
petroleum and natural gas, housing and other segments such as mining, disaster
management services, technology-related infrastructure.
ports, roads, rail system and logistics have been included in the transportation
sector. The agriculture sector comprises infrastructure-related storage facilities,
construction relating to agro-processing projects and reservation and storage
of perishable goods.
SEBI rules stipulate one-year lock-in period for those who buy shares prior to
an IPO by these companies.
the relaxation would allow government companies to attract more investors at
higher valuations by selling shares as pre-IPO placements as the investors have
an option to exit the company even on a shorter time-span.