Author Name: Anurag Bhullar
The prominent regulator of the securities market in India - SEBI, in an announcement made on Thursday, revealed the latest norms related to Mutual Funds and IPOs with a view to ease up the redemption pressures to a certain extent.
According to fresh guidelines issued by SEBI, the route for early exit in case of close-ended mutual funded schemes is blocked and listing of these MF schemes has been made compulsory. But these norms would only be applicable to new MF schemes.
As per the new norms, the fund houses are not allowed to buy back the mutual funds within the lock in period. And the mandatory listing requirement would provide an exit route to the investors. Apart from the Equity-linked saving schemes, all close-ended funds would now come under the debt category.
In case of IPOs, the validity period of IPOs has been raised from three months to one year. Other related IPO norms include, the companies would only be allowed to utilize right issue funds after the allotment of shares and the shareholders who have demat accounts will get their right shares in demat form.
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