As expected, Sebi has tightened the regulations governing Initial Public Offerings (IPOs) for SMEs. In its board meeting on Wednesday, the capital market regulator introduced profitability requirements as well as put a cap on shares to be sold through the offer for sale (OFS) route. SMEs will now be required to have an operating profit of at least `1 crore for two out of the last three financial years before filing their DRHP.
As expected, Sebi has tightened the regulations governing Initial Public Offerings (IPOs) for SMEs. In its board meeting on Wednesday, the capital market regulator introduced profitability requirements as well as put a cap on shares to be sold through the offer for sale (OFS) route. SMEs will now be required to have an operating profit of at least `1 crore for two out of the last three financial years before filing their DRHP.