The proposed structure is to streamline the process of issuing zero coupon zero principal instruments and other permission securities on SSE for NPOs, presenting a general bid and settlement platform called SSE Electronic Book Provider (SSE-EBP).
Under the draft circular, NPOs will have to use this new platform in a single issue or with the intention of raising 50 lakhs or more through shelf issues. SSE-EBP will be open for a wide range of participants, including eligible institutional buyers, non-institutional and retail investors.
However, investors and foreign funds of foreign portfolio will not be allowed to participate, Sebi said.
Also, the regulator said that the issuers will have to submit detailed funds next to the issue of the issue, specifying the details of the project, the size of the issue and other key conditions.
Next, investors will be able to bid through an anonymous pooling system in the working days between 9am and 5pm in the working days of the valid stock exchange. The regulator said in the consultation paper that the allocation would be made on the first-time-first-service or on Pro-Rata.
Issuer needs to submit draft fund rising document (DFRD) and term sheet profile issuing details such as size, bid conditions, minimum lot size and allocation mode.
These details must be introduced in two working days of the issue of the issue or five working days in the case of the first time issue, adding it.
To ensure transparency and responsibility, SEBI has given a strict guidance for KYC, ads and escrow-based fund settlement.
Any failure by successful biders in timely payment will lead to a 30-day debtor on the SSE-EBP platform.
Similarly, the issuers who withdraw from this issue for valid reasons may be banned from doing platform to cess for 7 days. Exceptions include cases where at least 75 percent of subscription or where investors fail to default on payment.
Securities and Exchange Board India F India (SEBI) has invited public comments on a circular till July 24.
The proposed method is expected to improve investors’ confidence and promote capital consolidation for the initiative of social impact.
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