SEBI has extended the deadline for IPO issue-size relaxation to March 31, 2027, according to a letter from the market regulator to Association of Investment Bankers of India (AIBI) seen by NDTV Profit.
In April, SEBI raised the permissible issue-size revision to 50% without fresh draft red herring prospectus (DRHP) filing. Companies can increase or decrease fresh issue size by up to 50% without filing a fresh draft offer document. The relaxation came in response to representations from the industry, highlighting challenges in raising capital amid subdued investor participation. Geopolitical tensions in the Middle East have been cited as a key factor weighing on market sentiment and affecting issuers' ability to accurately gauge demand and pricing.
The regulator had originally set September 30, 2026 as the deadline for the relaxation. Now, the relief will apply to IPOs opening on or before March 31, 2027, extending a meaningful window for companies planning to tap the markets.
Earlier, IPO issue-size changes beyond 20% required companies to file fresh draft offer documents.
Notably, the 50% flexibility comes with safeguards. Issuers must ensure there is no change in the core objectives of the issue. Lead managers will be required to certify that the offer documents remain compliant with regulatory provisions. Any revisions to the issue size must be appropriately reflected through an addendum to the DRHP, which must be made public. Further, companies seeking to revise their issue size will need to submit a formal application to SEBI, providing justification for the proposed change.
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