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No money? No bid: Sebi tightens IPO rules to ensure genuine bids

No money? No bid: Sebi tightens IPO rules to ensure genuine bids

The Securities and Exchange Board of India (Sebi) on Monday tweaked the initial public offering norms in a bid to ensure that only genuine entities participate.

The regulator is learnt to have found out that some large institutional investors and high net worth individuals were putting in bids only to inflate the subscription numbers and not with the intention of getting allotments.

According to a circular released on Monday, the market regulator said IPO applications should only be processed if there are supporting funds in an investor's bank account.

"Stock exchanges shall accept the ASBA applications in their electronic book building platform only with a mandatory confirmation on the application monies blocked," Sebi said in a circular.

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