The Securities and Exchange Board of India (SEBI) has unveiled an ambitious proposal to cut the time required to list shares on the country’s stock exchanges to bolster India’s stock market and facilitate faster access to capital. According to a consultation paper released on SEBI’s website cited by Reuters, the market regulator aims to reduce the listing timeline from the closure of initial public offerings (IPOs) to just three days. The proposed change has been hailed as a significant stride toward enhancing the ease of doing business and benefiting both issuers and investors.
SEBI emphasized the potential advantages of the proposed timeline reduction for listing and trading shares. In its consultation paper, the regulator stated that issuers would enjoy swifter access to the capital they raised, fostering a more efficient business environment. Simultaneously, investors would have the opportunity for early credit and greater liquidity in their investments. This move is expected to inject dynamism into the market, attracting more participation and stimulating economic growth.
The proposed changes have elicited keen interest and stakeholder feedback, with SEBI inviting public comments on the matter until June 3. Market participants, industry experts, and investors have been encouraged to provide their insights and opinions on the potential implications of the proposed reduction in listing time.
SEBI: Quick IPOs and Restricting Extreme Price Movement
SEBI’s endeavor to streamline the IPO process and boost market efficiency comes on the heels of another significant development. The market regulator also proposed measures to curb extreme price movements in shares actively traded through futures and options. The proposal, outlined in the consultation paper, includes extended trading suspensions and stricter restrictions on price fluctuations.
Under the new measures, if a share in the futures and options segment experiences a daily rise or fall of 10 percent, trading would be suspended for an hour—a significant increase from the current 15-minute suspension period. Additionally, the share would be allowed to move only an additional 2 percent, down from the current 5 percent. These safeguards are designed to address concerns raised by recent market events, such as the precipitous decline in shares of Gautam Adani’s group companies earlier this year. Following allegations of governance issues raised by U.S.-based short-seller Hindenburg Research, the group collectively suffered a staggering loss of over $100 billion in market value.
SEBI stressed the importance of such safeguards in maintaining market stability, managing risks, and safeguarding investor interests. The proposed measures seek to strike a balance between facilitating efficient trading and preventing excessive volatility that may compromise the market’s integrity.
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