SEBI wants companies to list shares within 12 days of IPO closure

Srting May, companies making initial public offers (IPOs) will have to list their shares within 12 days after the closing of subscription, the Securities and Exchange Board of India (SEBI) said on Tuesday.
Currently, companies can list shares up to 22 days after the issue closing.

A shorter timeline between issue closure and listing of shares will reduce market risk for investors, freeing up their funds faster and would also benefit companies as they would receive the IPO funds in their account faster.

However, for collecting banks this is not good news as a shorter timeline would mean fewer days to use the funds deposited in their escrow accounts till the allotment of shares.
However, merchant bankers say the market infrastructure would need upgradation to allow the system to cope with the pressure resulting from the new move.

According to industry sources, until more retail investor used the ASBA route it would not be possible to shorten the time period between the issue closure and listing.

In 2008, SEBI introduced a new process called application supported by blocked amount (ASBA) aimed at eliminating hassles involved in investor refunds.

Under the system investor funds would remain in their accounts till allotment of shares, but the investor would not be able to use the money from the time of application till the allotment of shares.