SEBI has told companies planning an IPO that they must clearly explain their capital structure and use truly independent checks on their financial projections.
What SEBI wants from IPO issuers
- Clear details of any past fundraising, preferential share allotments, and changes in ownership.
- Simple explanations of how the business makes money and where costs come from.
- Independent verification of working‑capital and capital‑expenditure forecasts, with all backup documents kept safe.
- Evidence of on‑site checks, such as reports and geo‑tagged photos.
Why the change matters
India leads the world in the number of IPOs, with over 300 offerings raising about ₹1.7 lakh crore this fiscal year. Better disclosure helps investors judge a company’s true value and reduces the gap between private‑market valuations and the price set during the IPO.
Impact on investors
- More reliable information can lead to smarter investment decisions.
- Transparent capital structures lower the risk of hidden control changes after listing.
- Independent due diligence aims to prevent overly optimistic projections that could later disappoint.
Other regulatory moves
SEBI also said it is reviewing a settlement with the National Stock Exchange over past co‑location and dark‑fibre disputes. The regulator is expected to give a no‑objection certificate for the NSE’s own IPO soon.
Disclaimer: This is an overview, not financial advice. Always do your own research before investing.