Sebi proposes new platform for startups to tap markets - Times of India

The author has posted comments on this articleAgencies | Mar 31, 2015, 05.53AM IST

The move is aimed at helping such companies raise funds from within India and stop their flight to overseas markets.

MUMBAI: To help startups and young entrepreneurs raise funds, the Securities and Exchange Board of India (Sebi) on Monday proposed an 'Alternate Capital Raising Platform', where such firms can raise money from institutions and HNIs from the capital markets under a relaxed regulatory regime.

However, retail investors would be restricted from investing in such companies, given the "risk involved", Sebi said in a discussion paper on the 'Alternate Capital Raising Platform', adding that adequate disclosures would be required to be made without hampering the capital-raising potential of such firms in new-age sectors like technology.

The move is aimed at helping such companies raise funds from within India and stop their flight to overseas markets. For want of a price discovery within the country, many of these companies plan to get listed in Singapore or the US.

The capital market regulator has sought public comments on the proposal by April 20 this year. Under the proposed platform, money should be raised only from institutions and high net worth individuals by the new-age companies having innovative business model and belonging to knowledge-based technology sector.

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