The US stock exchange Nasdaq had helped start up tech startup companies like Google, Facebook, Apple, Amazon and Netflix.
SEBI is preparing to build its own ‘Nasdaq’ (Nasdaq) through the Innovators Growth Platform (IGP). In India too, the listing of startup companies will be helped in providing funds by making easy listing.
SEBI wants startup companies in India to be helped in a similar way through the IGP. India’s early tech startup companies such as Make My Trip and Yatra are listed on Nasdaq. Nasdaq tech has proved to be very helpful in listing startup companies, which has made it easier for these companies to raise funds from the market. Still companies like ReNew Power and Grophers have moved into the US market through a Special Purpose Acquisition Company (SPAC).
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Many startups, including Jometo, set to launch IPO
Many startup companies in India are set to launch IPOs. These include Zomato, Deliveri and Nayaka. SEBI has made the Innovators Growth Platform easy like Nasdaq. SEBI wants to promote the listing of startup companies in India.
SEBI has given this facility to startups so far
The pre-issue holding period was reduced from the current 2 years to 1 year. This step will facilitate the allocation of startup companies to qualified investors. So far, only companies listed in BSE and NSE had this facility. According to the new regulations of SEBI, the company bringing the IPO can allot up to 60 per cent of the issue size to eligible investors. Its lock-in period will be 30 days. Till now, such allocation was not allowed to startup companies. The pre-issue shareholding of the investor has been reduced to 25 per cent of the pre-issue capital. It was earlier only 10 per cent.
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Startups are not profitable even if the main board of the stock exchange can be included
SEBI said that if more than 50 per cent of the startups that are not profitable are with qualified institutional buyers, then they can join the main board of the stock exchange. Earlier this limit was 75 percent. But now it has been reduced. For the takeover of the listed company on the Innovator growth platform, an open offer will have to be made for 49 per cent instead of the current 25 per cent.