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The caller SME IPO rules, introduced by nan BSE Ltd and nan National Stock Exchange of India (NSE), came into effect from Tuesday, July 1, 2025.
Shenoy believes that this guidance is overblown and rooted successful a misunderstanding of nan IPO process and nan SME exchange's role.
The caller SME IPO rules, introduced by nan BSE Ltd and nan National Stock Exchange of India (NSE), came into effect from Tuesday, July 1, 2025. The caller rules person been announced to heighten transparency and trim speculative unit information successful nan aftermath tightening scrutiny by nan marketplace bodies.
In nan caller rules, nan minimum exertion size is now 2 lots, weighted complete Rs 2 lakh, replacing nan earlier little thresholds that allowed smaller unit investments. This applies crossed each categories. Similarly, nan cut-off value action has been removed, on pinch nan expertise to cancel aliases revise bids downward, enforcing greater value discipline.
Besides this, bidding for SME IPOs shall adjacent astatine 4:00 p.m. connected nan last day, pinch UPI instruction confirmations owed by 5:00 pm, tightening nan process. Listing bound SMEs to person a minimum Ebitda of Rs 1 crore for 2 of nan past 3 years, headdress nan offer-for-sale astatine 20 per cent of nan rumor size, and limit wide firm intent costs to 15 per cent of nan rumor aliases Rs 10 crore.
By expanding nan minimum ticks size, it now ensures that only superior investors return portion and casual bidders are filtered out. SME stocks tin beryllium much risky and volatile, truthful this alteration really helps protect investors from getting into thing without due research, said Kresha Gupta, Director & Fund Manager astatine Steptrade Capital.
"Many investors would prime nan trim disconnected simply to summation their chances of allotment, assuming that nan discovered value would beryllium justified. But that attack ignores nan value of pricing discipline. Stricter timelines thief bring much subject and trim past infinitesimal issues for illustration delayed allotments aliases costs failures," she adds.
SME companies are rushing to motorboat IPOs earlier nan caller rules came into effect to leverage complete nan erstwhile relaxed norms, much lenient system, which allows broader unit information and little introduction barriers. As galore arsenic 30 SME IPOs were launched successful nan period of June 2025, raising much than Rs 1,380 crore.
The SME IPO conception successful India has seen an bonzer surge successful listings, pinch heightened investor information and buoyant marketplace conditions propelling galore mini businesses to pat nationalist markets. However, this accelerated maturation has besides exposed regulatory gaps, prompting SEBI to tighten norms, said Narinder Wadhwa, MD and CEO astatine SKI Capital Services.
"A slew of caller enforcement actions item systemic risks stemming from mediocre governance, inflated valuations, and misuse of marketplace mechanisms. Exchanges person now issued a stricter regulatory model for SME IPOs. The revised guidelines are aimed astatine restoring investor assurance by ensuring that only reliable and fundamentally sound companies entree nan SME platform," he said.
The dual bidding strategy (existing and new) is disposable for IPOs opening connected aliases earlier June 30, pinch a spillover play until July 11, aft which only nan caller rules apply, pushing companies to enactment swiftly.
Wadhwa said that nan move could temporarily slow nan gait of listings, it is simply a basal corrective measurement to beforehand patient superior formation. Overall, nan caller SME IPO norms, backed by caller enforcement actions, people a important measurement toward maturing nan SME marketplace into a much transparent, stable, and investor-friendly platform, he added.
Disclaimer: Business Today provides banal marketplace news for informational purposes only and should not beryllium construed arsenic finance advice. Readers are encouraged to consult pinch a qualified financial advisor earlier making immoderate finance decisions.
Published on: Jul 1, 2025 4:11 PM IST
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