SEBI proposes to extend the minimal funding restrict for SME IPO to Rs 4 lakh.

SEBI proposes to increase the minimum investment limit for SME IPO to Rs 4 lakh.

SME IPO 2024: With the rise in SME IPOs, investor participation in such choices has additionally elevated considerably.


New Delhi:

Market regulator SEBI on Tuesday proposed to extend the minimal funding restrict for making use of for SME (Small and Medium Enterprises) IPO to Rs 4 lakh. Its goal is to make sure that solely traders with ample danger urge for food and funding capability can apply. This step has been taken after the fast progress in SME IPOs. There was important participation from traders in these IPOs.

Improve in investor participation in SME IPO

With the rise in SME IPOs, investor participation in such choices has additionally elevated considerably. The investor-applicant ratio allotted was 4 instances in FY 2021-22, it has elevated to 46 instances in FY 2022-23 and 245 instances in FY 2023-24.

SEBI mentioned, “The participation of retail traders in SME IPOs has elevated in the previous couple of years. The danger in SME IPO is excessive and there’s a danger of them getting caught if sentiment adjustments after itemizing. In view of this, it’s proposed to extend the minimal utility measurement in SME IPO from Rs 1 lakh to Rs 2 lakh to guard the pursuits of small retail traders.

It will make sure that solely traders with danger urge for food and data apply for SME IPOs. Increased funding restrict will scale back the participation of small traders and appeal to traders with danger urge for food. It will enhance confidence within the SME section.

SEBI requested for solutions from individuals until December 4

In one other proposal, it has been prompt to extend the funding restrict from Rs 1 lakh to Rs 4 lakh per utility. Securities and Change Board of India (SEBI) has requested individuals to provide solutions on this regard until December 4.


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