New Delhi: Securities and Exchange Board of India (SEBI) chairperson Madhabi Puri Buch says that the job of the capital market regulator is not at all to suggest prices for initial public offerings of new generation technology companies. However, at the same time, he has said that companies should disclose more about how the valuation changed between IPO pre-planning and the price sought for the issue. After investing money in some IPOs of new generation companies, common investors have suffered a lot in this. Due to which there have been indications that the companies had put the issue in the market at very high prices.
Addressing the annual capital markets conference organized by industry body FICCI, Buch said on Tuesday that a lot is talked about the value of IPOs of tech companies. It is your job to see at what price you want to IPO. It's not our job to make suggestions about it. Giving an example, SEBI's first woman head Buch has said that a company is selling shares to investors at a price of Rs 100 per share. But after a few months when they bring IPO, they ask for Rs 450. She has said that the company is free to ask for a higher price, but they should disclose what has happened during this period that has caused the share price to rise so much.
It has been seen that the retail investor has been the most affected by the high valuations of the new generation technology companies. Shares of payments platform Paytm have been one-third of the issue price of the IPO within a few weeks of listing. When asked questions on the recent developments, Buch said that investment bankers should answer this. She said the regulator will keep its stance democratic while framing the regulation and it will work only on the basis of data. She has said about this that under the restructuring process, SEBI has appointed one to three officers in each such department, whose main source is to bring such views on sector regulation, so that the industry can be happy. She said that the regulator should change the SEBI law. So that it can also test potential ideas in a regulatory sandbox.
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