SEBI has released a Consultation Paper for public comments (till 16th November) on Review of framework for Institutional Trading Platform on 26th October, 2018.
Currently, the framework for ITP is specified under chapter X of the SEBI ICDR Regulations, 2018. In view of the evolving start-up ecosystem and to make the ITP platform more accessible, SEBI discussed the issues with various stakeholders and constituted a Group on June 12, 2018 to review the ITP framework.
Important changes proposed by the consultation paper are:
- To rename the platform as ‘Innovators Growth Platform’ (“IGP”) from ‘Institutional Trading Platform’.
- Change in eligibility for listing on the ITP by replacing Regulation 283(1)(b) with “In order to be eligible for listing on the ITP, 25% of the pre-issue capital, for at least a period of 2 years, should have been held by Qualified Institutional Buyers/other regulated entities* and/or Accredited Investors (AIs)** out of which not more than 10% should be by AIs.
- Removal of Regulation 283(2) to remove separate capping post IPO shareholding.
- Reduction of minimum application size in secondary market from 10 lakh to 2 lakh.
- Removal of minimum reservation of allocation to any specific
category of investors. Currently, it is allocated as75% of the net offer to public to institutional investors and remaining 25% to Non Institutional Investors. - Reduction in minimum number of allottees from 200 to 50.
- Reduction of minimum trading lot size in secondary market from 10 lakh to 2 lakh.
- IGP will be designated as a Main Board platform for start-ups with an option to
trade under regular category after completion of one year of listing instead of 3 years. - Reduction in minimum offer size to 10 crores from 25 crores as per Rule 19(2)(b) of Securities Contracts (Regulation) Rules, 1957.
