India should lower entry barriers for companies wishing to float IPOs. SEBI should be more like SEC

Synopsis: SEBI needs to usher in reforms to make Indian public equity markets more attractive to investors and companies willing to issue IPOs (Initial Public Offer). 

What is an IPO? 

Whenever a company issues its shares first time to the public, it is known as Initial Public Offer (IPO). Issuing shares is a method of raising capital.  

Eligibility criteria for companies willing to float an IPO. 

• SEBI (Securities and Exchange Board of India) has a tougher criterion:  

• Tangible assets of at least Rs 3 crore 
• Exhibit average operating profits of Rs 15 crore in the preceding three years with no operating losses in any one of those years. 
• Net worth of Rs 1 crore in each of the three preceding years. 

Securities and Exchange Board of India 

Source: TimesofIndia