(NDTV Profit)
In a move aimed at making rights issues a more attractive and efficient mode of fundraising, the Securities and Exchange Board of India on Tuesday issued several proposed changes to the current regulatory framework. One of the key proposals is to discontinue the requirement for companies to file a draft letter of offer with SEBI for its observations. Instead, SEBI suggests that only essential information related to the rights issue—such as the purpose of the issue, pricing, record date, and entitlement ratio—needs to be disclosed.
This shift is expected to simplify the process and reduce the time taken for approvals. Currently, the process of conducting due diligence and preparing detailed offer documents by merchant bankers can take 50–60 days. The absence of specific timelines for completing these procedures often leads to delays in the overall fundraising process.
