SEBI proposes stricter IPO fund oversight, with fines and promoter demat freezes
CNBC-TV18 1 hr ago·13 Oct 2026, 4:36 pm
The Securities and Exchange Board of India (SEBI) has proposed a significant overhaul of how listed companies manage the money raised during their initial public offerings (IPOs). The regulator aims to improve transparency by requiring monitoring agencies to directly report fund usage to stock exchanges. Additionally, the new rules introduce stricter penalties, such as fines of ₹50,000 for non-cooperation and the potential freezing of promoters' demat accounts if violations continue.
This move is crucial for investors as it addresses long-standing concerns regarding the misuse of IPO proceeds. By mandating direct reporting and imposing harsher consequences, SEBI aims to ensure that the funds are used for their intended business purposes. This could help protect the interests of small investors and restore trust in the capital markets.
Investors should watch for the final implementation of these rules and the subsequent regulatory circulars. The effectiveness of these measures will depend on the strict enforcement by SEBI and the willingness of listed companies to comply. This development signals a shift towards greater accountability in the primary market.
Excerpt from CNBC-TV18
Published On Oct 13, 2026 | 22:01 IST Last Updated On Oct 13, 2026 | 22:06 IST SEBI has proposed tighter oversight of how listed companies use issue proceeds, including direct reporting by monitoring agencies to stock exchanges, ₹50,000 fines for non-cooperation and possible freezing of promoters’ demat accounts if…Read the original at CNBC-TV18
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