New Delhi: The Securities and Exchange Board of India (Sebi) has proposed adding audio-visual presentations of information provided by companies in their offer documents when they go public. The goal is to assist investors in better understanding the main aspects of such offers.
Stakeholders have been invited to provide feedback on the proposal by April 9.
The proposal suggests that companies planning to list on the main board will need to present the information from their Draft Red Herring Prospectus (DRHP) and Red Herring Prospectus (RHP) in audio-visual (AV) format.
The AV will be bilingual, available in both English and Hindi, and accessible to the public. Sebi expects the AV will simplify the understanding of essential features and provide references to various disclosures in the proposed public issue.
Each bilingual AV will have a maximum duration of 8 minutes, distributing its total duration evenly among material disclosures covering sections such as objectives of the offer, capital structure, risk factors, issuer’s business, financial information, litigations, and material developments.
Sebi insists that the AV should focus on factual information and avoid promotional content. It should also be updated with the latest information when reaching the RHP stage. Issuers or lead managers must publish the AV within 5 working days during both the submission and resubmission stages of the DRHP.
The notice said, “It shall be made available on digital/social media platforms of the Issuer and Association of Investment Bankers of India (AIBI). The web link of the said AV shall be made available on the websites of stock exchanges and the concerned lead managers and shall also be accessible from the QR code pertaining to the public issue.”
Companies seeking to raise funds through public offerings need to submit a DRHP to Sebi and stock exchanges. This document is then revised based on feedback from regulators and exchanges. Afterward, the finalised RHP is submitted to Sebi and the Registrar of Companies (RoC).
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