MPS Exemption For All PSUs Up To 2 Years: Report
Recently in May, LIC gets the Sebi nod to the exemption of 3 years from minimum public shareholding
India has exempted all state-run firms from meeting minimum public shareholding norms (MPS) for two years until August 2026, Reuters reported.
As per the market regulator's rule, all listed Indian companies, including public sector firms, must maintain a minimum public shareholding (MPS) of 25per cent.
Now, the market regulator Securities and Exchange Board of India (SEBI) will have to bring the change into effect, a document showed, reported Reuters. This is not the first time the exemption has been given. India's capital market regulator has been giving state-run companies exemptions from the MPS norm for years now. Recently months ago LIC got the Sebi nod to exemption for 3 years
In January 2021 the Ministry of Finance amended the Securities Contracts (Regulation) Rules, 1957 to exempt listed public sector companies from the minimum public shareholding norm.
Extending that exemption for the state-run firms may encourage more investors to buy stakes in government companies. But interestingly in the 2019-20 Budget, the government had proposed to increase the minimum public float from 25 per cent to 35 per cent.
