SEBI Proposes Eased IPO Norms under ICDR Regulations

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  • Last Updated on 2 August, 2025

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Consultation Papers Dated 31.07.2025

SEBI Proposes Key Amendments to ICDR Regulations for IPO Reforms

The Securities and Exchange Board of India (SEBI) has released a consultation paper proposing significant amendments to the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018. The aim is to enhance ease of doing business and address various practical challenges in the IPO process. These proposed changes are part of SEBI’s ongoing efforts to refine the capital-raising framework and ensure greater efficiency, transparency, and investor participation in primary market offerings.

Proposed Discretionary Allotment in Anchor Portion of IPOs

One of the key proposals in the consultation paper relates to permitting discretionary allotment within the Anchor Investor portion of an Initial Public Offer (IPO). This change is expected to provide issuers more flexibility in allocating shares to investors of strategic importance, which may in turn strengthen price discovery and enhance confidence in the offering. The current rules do not permit such discretion, and this amendment could bring India’s regulatory framework more in line with international best practices.

Expansion of Anchor Book to Include LICs and Pension Funds

SEBI has also proposed a reservation for allocation within the Anchor Book for Life Insurance Companies (LICs) registered with IRDAI, and Pension Funds registered with PFRDA, along with Domestic Mutual Funds. This aims to diversify the institutional investor base in IPOs, ensure long-term participation, and reduce dependence on a limited set of investors. The inclusion of such stable, long-horizon investors is likely to promote market stability and encourage greater public confidence in IPOs.

Retail Sizing Flexibility and Stakeholder Feedback

Another key reform under consideration is allowing greater flexibility in determining the retail portion size in large IPOs, which can improve efficiency and better align demand with supply. SEBI is actively seeking public comments and suggestions on these proposals to ensure stakeholder alignment and regulatory clarity. Interested parties are encouraged to submit their feedback by August 21, 2025, ensuring that all voices are heard in shaping the future of India’s primary market regulations.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied