SEBI tweaks ICDR norms; introduces norms for IPO on main board through pre-filling of draft offer document

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ICDR norms

Notification No. SEBI/LAD-NRO/GN/2022/107, Dated 21.11.2022

The SEBI has notified the SEBI (Issue of Capital and Disclosure Requirements) (Fourth Amendment) Regulations, 2022. A new Chapter IIA has been inserted, providing provisions relating to the Initial Public Offer (IPO) on the main board through the pre-filling of a draft offer document, Interaction with qualified institutional buyers, and General Conditions. Before this amendment, it was mandatory for an issuer to file copies of draft offer documents with the concerned regional office of the Board. Later, which was kept open for issuing observations by the Board and was also be kept open for public opinions and observations.

SEBI has also allowed issuers to interact with qualified institutional buyers for limited marketing of the intended issue from the time of pre-filing the draft offer document till the Board issues any observations. In case the issuer interacts with the QIBs, the issuer and lead manager(s) shall prepare a list of the qualified institutional buyers who have participated in such interaction(s).

Further, new regulations 162A and 173A require an arrangement of CRAs as a Monitoring agency to monitor the use of proceeds where the issue size exceeds 100 Cr.

This amendment will help companies keep their offer documents private until they firm up their IPO plan. The offer documents will be open to scrutiny from the regulators and exchanges but won’t be open to the public i.e., it won’t be getting uploaded in Board’s website. The company will then have to file an updated DRHP, which will be a public document.

The norms further provide that if the issuer interacts with the QIBs, the issuer and lead manager(s) shall prepare a list of the qualified institutional buyers who have participated in such interaction(s).

Click Here To Read The Full Notification

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