SEBI makes big changes in market norms

One AI will be allowed to invest up to 30 per cent of the quota reserved for Qualified Institutional Buyers (QIB). Since the QIB quota is 50 per cent of the IPO size, an AI will effectively get 15 per cent of the total issue.

Moreover, the market regulator said, an AI will have to invest a minimum of Rs 10 crore and has to bring in 25 per cent of the margin on application and another 75 per cent within two days of the closure. The lock-in period for an AI will be 30 days, said C B Bhave, chairman, Sebi.

Sebi has also relaxed disclosure norms in rights issue of shares by reducing the amount of information to be provided at the time of the issue. It also banned issue of shares with superior voting rights.

In case of mutual funds Sebi has said that there will be no entry load for any scheme, existing or new, of a mutual fund. The upfront commission to distributors shall be paid by the investor directly. Distributors, on their part, will have to declare the commissions that they are getting from the investors.