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India Market Regulator Tightens Listing Norms Amid IPO Frenzy

  • Raises lock-in requirements for share sale by anchor investors
  • Credit rating agencies to monitor utilization of IPO proceeds
A pedestrian walks past the Bombay Stock Exchange (BSE) building in Mumbai, India.

A pedestrian walks past the Bombay Stock Exchange (BSE) building in Mumbai, India.

Photographer: Dhiraj Singh/Bloomberg

India’s capital market regulator Tuesday unveiled a series of measures to improve and strengthen fund raising norms for companies in what has been a record year for initial public offerings.   

The Securities & Exchange Board of India tightened rules for share sales by anchor investors, capped the usage of IPO proceeds for general corporate purposes and unidentified acquisitions, and made it easier for founders to raise funds through a preferential allotment of shares. It also asked credit rating agencies to monitor the utilization of IPO funds and present their report before the company’s audit committee every quarter.