SEBI issues listing norms for infrastructure investment trusts

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Securities market regulator SEBI has said that institutional investors would be allocated maximum of 75 per cent in a public offering of Infrastructure Investment Trusts’ (InvIT) units.

Other investors, including retail, would be allotted at least 25 per cent, SEBI said, while outlining guidelines for a public issue on units of InvITs in a circular on Wednesday.

Anchor investors may be allotted up to 60 per cent of the institutional book on a discretionary basis. Bidding would open a day in advance for anchor investors whose money would be locked-in for 30 days.

An issue of InvIT may open five days after the final offer document is filed with SEBI.

The investment manager may discover the price of InvIT units either through book building or in consultation with the lead merchant banker. However, investors cannot be offered a differential price, SEBI said.

Floor price

The investment manager has to announce the floor price or price band of the units at least five days prior to opening of bids in case of an IPO of InvIT units. The announcement has to be made in the website of the sponsor, investment manager, stock exchanges and in all the newspapers which carried the pre-issue advertisement.

The issue price would be determined by the investment manager in consultation with the lead merchant banker and only those entities, which have bid at or above the issue price (cut-off price), would be entitled for allotment of units.

Bids of institutional investors may be rejected by the lead merchant banker. However, such rejections would have to be made at the time of acceptance of bids after providing reason to the bidder and recording the same in writing,

ASBA has been made optional but bidding through electronically linked bidding facility of a stock exchange is mandatory.

Withdrawal or lowering the size of a bid has been prohibited. Applicants would be allotted units on a proportionate basis.

Investment managers have to appoint a compliance officer for monitoring compliance of securities laws besides redressing investor grievances.