The ceiling for minimum public offer has been brought down from 25 per centto 10 per cent of the post-issue capital, comprising a minimum of 20 lakhshares. Further, the size of the net offer to public by such companies hasbeen fixed at a minimum of Rs 50 crore. This has brought the media andentertainment companies at par with the infrastructure companies.

In order to further strengthen the book-building process, a 100 per centone-stage book building has been permitted with bidding centres at allcities with stock exchanges. Further, the issuer will have to disclose onlythe floor price as the indicative price since bidding in the recent past hasresulted in bidding only at the upper end and has affected the proper pricediscovery. Sebi board, which met in New Delhi on Friday, has furtherapproved amendments to the Sebi (mutual funds) regulations to permitinvestments by mutual funds in mortgage-backed securities, having a creditrating of not below the investment grade and represent investments in realestate mortgages and not directly in real estate. These provision could be abig boost to the housing sector, said Sebi chairman DR Mehta.

Mehta said that the IPO norms have been relaxed further for these sectorskeeping in view the low capital requirement of knowledge-based companies,the board decided to extend the relaxation under Section 19(7) of the SCRRules, 1957 presently available only to infotech companies.

IPO relaxations announced on Friday to the media and entertainment companiesis going to be a big booster for a flurry of offerings lined up. Initialofferings of media companies like UTV, NDTV, Star TV and Sun TV are slatedto hit the capital market over the next few months. Mehta said the boarddecided to relax the minimum limit for the companies planning IPOs so thatIndian market does not lose good quality shares.

The IPO relaxation will be subject to the condition that the revenue andprofit sources of not less than 75 per cent has to emanate from thesesectors. Sebi has also said that the sector-wise income, revenue and assetposition will also have to be disclosed in the offer document.

Mehta, however, clarified that the earlier prerequisites of either a threeyear track record of profitability or appraisal from a FIs or bank and afinancial participation of not less than 10 per cent would continue. Theboard also reviewed the status of the entities having collective investmentschemes and as on March 31, 2000, 36 applications for grant of registrationwere received from the existing entities which had reportedly mobilisedabout Rs 294.55 crore. Another 60 entities which had collected about Rs 426crore had intimated Sebi about their intention to repay the investors andwind-up their schemes in terms of the provisions of Sebi (CIS) regulations1999.

Mehta said the amendments to book building would further help to rationalisethe provisions of book building guidelines and introduce greatertransparency. The present provisions of allowing 75 per cent of the issue tobe offered through book building would continue. The fixed price issueportion applicable for the balance 25 per cent of the issue would continueto be available to individual investors applying for up to 1000 shares.

On 100 per cent book building, institutional investors will not be allocatedmore than 60 per cent of the book built portion. Of the remaining portion,non-institutional investors applying for more than 1,000 shares will begiven at least 15 per cent, while small investors will be given 25 per centon pro-rata basis. Further, online display has been made mandatory for allissues through book building and data entry of bids will be on realtimebasis. A uniformmargin will also be collected from non-institutional andindividual investors, if any.