Sebi has barred mutual fund schemes from investing in pre-IPO share placements but will allow participation in anchor rounds of public issues, a source told PTI citing the move is intended to improve liquidity and ensure clearer valuation of companies ahead of listing.“We have asked mutual fund schemes not to invest in pre-IPO placement of shares but invest in anchor rounds,” the source told PTI.Earlier this month, Sebi revised the share-allocation framework for anchor investors in initial public offerings to expand the share reserved for domestic institutional participation, including mutual funds, insurers and pension funds. Under the revised norms, the total anchor portion has been raised to 40 per cent from 33 per cent. Of this, 33 per cent is earmarked for mutual funds, while insurers and pension funds get the remaining 7 per cent.If the 7 per cent set aside for insurance and pension funds remains unsubscribed, it will be reallocated to mutual funds.Sebi is also preparing to replace the mandatory abridged prospectus with a standardised “offer document summary” for IPOs to make disclosures easier to navigate for retail investors, the source said. The regulator believes existing abridged prospectuses remain lengthy and deter investor review despite simplification attempts.On derivatives trading behaviour, the source said there is “irrational exuberance” among a segment of retail participants, which is leading to significant losses.
