Consultation Papers Dated 31.07.2025
SEBI Proposes Key Amendments to ICDR Regulations for IPO Reforms
The Securities and Exchange Board of India (SEBI) has released a consultation paper proposing significant amendments to the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018. The aim is to enhance ease of doing business and address various practical challenges in the IPO process. These proposed changes are part of SEBI’s ongoing efforts to refine the capital-raising framework and ensure greater efficiency, transparency, and investor participation in primary market offerings.
Proposed Discretionary Allotment in Anchor Portion of IPOs
One of the key proposals in the consultation paper relates to permitting discretionary allotment within the Anchor Investor portion of an Initial Public Offer (IPO). This change is expected to provide issuers more flexibility in allocating shares to investors of strategic importance, which may in turn strengthen price discovery and enhance confidence in the offering. The current rules do not permit such discretion, and this amendment could bring India’s regulatory framework more in line with international best practices.
Expansion of Anchor Book to Include LICs and Pension Funds
SEBI has also proposed a reservation for allocation within the Anchor Book for Life Insurance Companies (LICs) registered with IRDAI, and Pension Funds registered with PFRDA, along with Domestic Mutual Funds. This aims to diversify the institutional investor base in IPOs, ensure long-term participation, and reduce dependence on a limited set of investors. The inclusion of such stable, long-horizon investors is likely to promote market stability and encourage greater public confidence in IPOs.
Retail Sizing Flexibility and Stakeholder Feedback
Another key reform under consideration is allowing greater flexibility in determining the retail portion size in large IPOs, which can improve efficiency and better align demand with supply. SEBI is actively seeking public comments and suggestions on these proposals to ensure stakeholder alignment and regulatory clarity. Interested parties are encouraged to submit their feedback by August 21, 2025, ensuring that all voices are heard in shaping the future of India’s primary market regulations.
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