Minimum Public Shareholding Norms In India, Is It Time For Change?
Legal Era|September 2019
One of the Big-bang Proposals in the Union Budget Was for the Sebi to consider increasing minimum Public Shareholding Requirement in Listed Companies to 35 Per Cent.
Minimum Public Shareholding Norms In India, Is It Time For Change?

On July 5, 2019, the Indian finance minister, in her debut budget speech, announced a few big-bang proposals. One such proposal was for capital market regulator Securities and Exchange Board of India (“SEBI”), to consider increasing minimum public shareholding requirement in listed companies from the current threshold of 25% to 35%.

Jabarati Chandra

Partner, S&R Associates

The current threshold

Many Indian listed companies are promoter-owned and controlled (promoters are generally controlling shareholders in a company). For an initial public offering to be successful and for continuous listing, the Securities Contracts (Regulation) Rules, 1957, as amended (“SCRR”), includes the concept of a minimum public float (public is defined to exclude promoters and the promoter group).

This story is from the September 2019 edition of Legal Era.

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This story is from the September 2019 edition of Legal Era.

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