Securities and Exchange Board of India Chief Madhabi Buch launches Investor Risk Reduction Access Platform
National
Securities and Exchange Board of India (SEBI) chief Madhabi Puri Buch has promised to address the issue of inflated valuations in initial public offerings (IPOs) as many companies flood the market with their share sales. Five companies, including Tata Technologies, launched their IPOs and raised an unprecedented ₹2.6 lakh crore in application funds. Some companies and their investment bankers engage in IPO pricing by setting a low face value and then significantly increasing the issue price under the guise of a higher premium. Buch recalled a study conducted by SEBI last year which showed that nine out of ten investors lost money in the derivatives market. He said trading on a short-term basis could lead to a situation where investors could suffer losses on a weekly basis.
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