A SEBI directive and a soaring secondary market have led to a flurry of initial public offerings aimed at making it before September 30.
Some Rs 4,000 crore will be raised through 12 IPOs that are being pushed through during this period. Since September 14, any given day of the month has seen at least two ongoing IPOs to date, and the rest of the month is going to be no different, at least until September 27.
"A big reason for this flood of offerings is because of the September 30 deadline set by SEBI," said Mr Sanjay Jain, Executive Director and Head of the Investment Banking Division at JM Financial Consultants. SEBI has said that if companies have issuances that hit the market after September 30, then they will have to publish their June quarter results. Those that enter the marker before that can file the DRHP with their March-end annual results.
What is interesting is that the June quarter results of many of the listed companies were below expectations, and that of yet-to-list companies are likely to be the same, said analysts. It is not a surprise then that they don't want to raise funds using their June quarter results.
The message is contained in the last sentence of the above para - companies don't want to raise funds using their June quarter results. But why? Because, the June quarter results of many of the listed companies were below expectations, and that of yet-to-list companies are likely to be the same, said analysts.
Corporate governance philosophy of Infosys is based on the seven principles, out of which the first two appear relevant in this situation -
- Satisfy the spirit of the law and not just the letter of the law. Corporate governance standards should go beyond the law.
- Be transparent and maintain a high degree of disclosure levels. When in doubt, disclose.