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SEBI commits to make startup listing easy and painless

VCCircle_SEBI_2Noting that number of start-ups in the country are growing at a rapid pace, SEBI chairman U K Sinha said the new guidelines by the capital market regulator will help these firms list on the capital markets in a “painless and easy” manner. The SEBI chief said that in the next six months of this fiscal a number of start-ups would take advantage of these norms to get listed on bourses in a hassle-free way. “In India, technological start-ups have crossed 3,000 and the way the new start-ups are coming up at the rate of almost 800-1,000 per year, I think we would cross 10,000 start-ups by 2020″, Sinha said in Mumbai.

“I am sure a very painless easy method of listing of these start-ups has been provided in the next six months of the financial year a number of them would be able to take advantage of it”, he added. Sinha was speaking at the launch of SIDBI’s India Aspiration Fund by Finance Minister Arun Jaitley to boost start fund-of-funds ecosystem in the country. Recently, Securities and Exchange Board of India (SEBI) had notified new set of listing norms for start-ups including e-commerce ventures, on a separate platform of domestic stock exchanges.

The SEBI chief also noted that though more focus has been on the public markets in the country, it is important to realise the role which the venture capital industry can play. “In 2014, VC capital has invested 15 billion dollars in this country and 12 billion in 2013. If you compare it with the money invested in primary market there is no comparison, it is way ahead”, Sinha said. He said as public markets get more attention the SEBI has been trying to promote the growth of alternative investment fund (AIF) industry.

“We came out with AIF regulations more than 500 investment funds have been created”, Sinha added. He said the government had provided clarity on taxation issues related to AIF. “A few other pending issues would also be sorted out in in time by the government with respect to AIF”, he added. Sinha also observed that the market capitalisation of small and medium enterprises (SMEs) listed on the stock exchanges has increased over two times in the last two years.

Finance minister Arun Jaitley launched two funds by Small Industries Development Bank of India (SIDBI) India Aspiration Fund (IAF) and Rs 10,000 crore SIDBI Make In India Loan For Enterprises (SMILE) scheme in Mumbai. On the initiative, Sinha said the government is not going to loose money in this as it will help promote entrepreneurship and give boost to employment.

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