Sebi sets up working group to review Innovators Growth Platform framework

The Securities and Exchange Board of India (Sebi) has constituted a working group to undertake a comprehensive review of the regulatory framework governing the Innovators Growth Platform (IGP), with a focus on improving access to capital markets for start-ups and innovation-led enterprises.

The review comes amid the evolution of India's start-up and innovation ecosystem, with the emergence of businesses in areas such as deep-tech, biotechnology, semiconductors, space and other research-intensive sectors, which may have distinct financing requirements and business models.

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The working group will examine the relevance and effectiveness of the existing IGP framework under the Sebi (Issue of Capital and Disclosure Requirements) Regulations, 2018, and recommend changes to facilitate capital raising by such enterprises while maintaining investor protection, according to the Sebi's latest circular.

The panel will review the existing eligibility and listing requirements and assess their suitability for research-stage, pre-revenue, intellectual property-led, deep-tech and other technology-intensive companies.

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It will also examine the eligibility, participation and investment requirements applicable to IGP investors, with a view to ensuring appropriate investor protection.

On the fundraising front, the working group will review the framework governing public issues and offers for sale (OFS), including pricing, allocation and minimum subscription requirements for companies seeking to list on the platform.

The review will also cover post-listing obligations applicable to IGP entities, including disclosure requirements, corporate governance, trading and continuing compliance obligations.

Another key area of examination will be the framework for migration from the IGP to the main board, including the eligibility criteria and procedural requirements for such a transition.

The working group will also benchmark India's IGP framework against relevant international regulatory frameworks for innovative, technology-led and growth-stage companies and examine possible adaptations for the domestic securities market.

Based on its assessment, the panel will recommend necessary amendments to the applicable regulatory framework, including transitional and implementation measures.

The working group has representation from the venture capital, private equity, start-up and industry association ecosystem.

Srini Srinivasan, chairman of the Indian Venture and Alternate Capital Association, and Prashanth Prakash, partner at Accel Partners, will serve as co-chairs of the panel.

Other industry representatives include P M Murali, president of the Association of Biotechnology Led Enterprises; M D Ranganath, chairman of Catamaran Ventures; Umakant Soni, co-founder of Bharat.1AI; Kedar Upadhye, chief financial officer of Biocon; and Pawan Kumar Chandana, co-founder and chief executive officer of Skyroot Aerospace.

The panel also includes Siddharth Pai, founding partner of 3one4 Capital; Naganand Doraswamy, founder and managing partner of Ideaspring Capital; and Nishant Sharma, founder and managing partner of Kedaara Capital.

Representatives from the Department for Promotion of Industry and Internal Trade, the Institute of Chartered Accountants of India, the Institute of Company Secretaries of India, the Confederation of Indian Industry and the Association of Investment Bankers of India have also been included in an ex-officio capacity.

The chief regulatory officers of the National Stock Exchange and BSE, along with a representative from Sebi's Corporation Finance Department, will also be members of the working group.

Members of the panel may engage with start-ups, industry associations and other relevant stakeholders to understand sector-specific requirements and identify measures to improve access to the IGP while maintaining market integrity and investor protection.

The recommendations of the working group will be submitted to Sebi for consideration.

Disclosure: This article has been written by Kumar Gaurav, who is not a Sebi-registered Research Analyst or an Investment Adviser. Gaurav and their ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective Sebi-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here