The Securities and Exchange Board of India vide its notification dated 1st July 2020 has published The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2020.
Through this amendment, SEBI has provided an additional option for pricing methodology with respect to preferential issues.The price of the equity shares to be allotted pursuant to the preferential issue shall not be less than the higher of the following:
- The average of the weekly high and low of the Volume Weighted Average Price (VWAP) of the related shares during the 12 weeks preceding the relevant date
- or such average of the weekly high and low of VWAP of shares during the two weeks preceding the relevant date.
Specified securities allotted on a preferential basis using the pricing method determined above shall be locked-in for a period of three years and the option in pricing would be available for the preferential issues made between July 1 and December 31, 2020.
Click here to read the notification.
