SEBI proposes to ease minimum shareholding norms in view of expanding market
SEBI recently released a consultation paper for review of provisions related to requirement of Minimum Public Offer and timelines to comply with Minimum Public Shareholding which proposes to increase the flexibility of minimum public shareholding (MPS) and minimum public offer (MPO) for companies aspiring to get listed aimed at simplifying fund-raising by issuers in India. The paper proposes to change threshold buckets for post-issue market capitalisation (m-cap) to Rs. 4,000 crore to Rs. 50,000 crore, Rs. 50,000 crore to Rs. 1 lakh crore, Rs. 1,00,000 crore to Rs. 5 lakh crore and above Rs. 5 lakh crore. Currently, it is at Rs. 4,000 crore, Rs. 1 lakh crore and above Rs. 1 lakh crore. SEBI has also increased the timeline to comply with MPS.
In another proposal, the capital market regulators sought public feedback on reducing the MPO for buckets starting from Rs. 50,000 crore to Rs. 1 lakh crore. Under the current regulations as per the Securities Contract Regulations Rules (SCRR), “issuers with a post issue market cap above ₹1,00,000 crore are required to ensure MPO of ₹5,000 crore and at least 5% of the post issue share capital; and are mandated to increase their public shareholding to at least 10% within 2 years from date of listing, and further to a minimum of 25% within 5 years from date of listing.
Comments may be submitted by 8th September, 2025.
