The Securities and Exchange Board of India (SEBI) Chairman Ajay Tyagi on Friday said a host of reasons, including general slowdown of economy, were behind the poor show of IPOs and expressed hope that things would improve in the second half of this fiscal. Talking to newsmen on the sidelines of a seminar on “GIFT IFSC : Onshoring the Offshore” at The GIFT City Club near here, Tyagi, who was the chief guest at the event said, ”The poor show of Initial Public Offers (IPO’s) was basically because of the slowdown.”
Replying to a query, he said, ”It started in September last year and after that Infrastructure Leasing & Financial Services Limited (IL&FS) issue (regarding non payment of debt) affected the sentiments on the debt market. And thereafter, I think it was some sort of anxiety over election (which got over). After that we have this issue of slowdown in economy globally and to that extent here also. These were the reasons because of which the IPO people are still waiting for coming with new issues. It will hopefully pickup in the second half. Let’s see because one has to wait.”
He added that the poor show of IPOs was also among one of the reasons because of which the SEBI has asked the government to re-examine its proposal about mandating 35 per cent minimum public shareholding in listed companies as proposed in the last union budget.
To another query about the negativity despite recent easing up of various norms with regard to the Foreign Portfolio Investment (FPI), he said that the negative sentiment was not related with the FPI alone. He attributed general slowdown as one of the reasons for it as well.
”There were various other reasons in the economy and it was not only because of FPI sentiments. The quarter earnings are not improving and there is a general slowdown issue. So it is very difficult to say that it was because of FPI in a major way,” he said, adding that the Foreign Portfolio Investors were fully satisfied with the steps take to simplify and rationalise the things. On being asked about the proposal of the Association Of Mutual Funds in India’s (AMFI) recommendation to allow mutual funds (MF) to sign the inter-creditor agreement for resolution of stressed assets, Tyagi said that it was being examined. (UNI)
