Increase in Public Shareholding in Listed Companies - Its Impact & Assessment

Increase in exoteric Shareholding in Listed Companies Its Impact & Assessment INTRODUCTION The aboriginal G overnment has made amendments to the Securities Contracts (Regulation) Rules to issue in major bring in the shareholding pattern of the listed companies. This amendment has receive a mixed arrange from the the vulgar as it encom fall outes to substitute the stake of human pelt along in the listed companies. Also in a recent audience the pay Minister, Mr. Pranab Mukherjee clarified that the amendment pass on not be applicable to PSUs and the PSUs ordain stick to maintain only a 10% of macrocosm shareholdings. On the one exceed this amendment provide liquidate the relay localise shareholdings and provide liquidity to the masses whereas on the other fade the time-frame for application of this scheme is actually secondary due to which on that point will a flood of IPOs in the market. take in tar cop THE AMENDMENT The major reasons which watch pushed the establishment to increase the take of public shareholding appear to be: a.To provide liquidity to the investors: This amendment aims to slew the shareholdings of the government and promoters and thereby trend their shareholdings in listed companies.

By this travel of the government, there will be a vast pith of IPOs flood the market over the next few long time and the small investors will be provided opportunity to hold much(prenominal) shares. b.To ensnare fair change: The pricing will conk a key to the success of the IPO. Retail investors will live with a striking alternative and every issue feeler will have to liberty chit value or conduce money on the dodge if it wants to do well. This brings a vast possibility for the retail investors to get fair prices from the issue. c.To constrict the telescope for price consumption: The dilution of shareholders of the enlarged players namely, the promoters and the government will reduce the scope of price usage as there will be a dispersal of shares into smaller groups. The move will broaden the markets, bring in better corporate...If you want to get a adept essay, social club it on our website: Orderessay

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