India stock regulator mulls pay-backs for investors burnt by IPOs: report
AFPMUMBAI -- India's stock market regulator is considering a plan that would see small investors reimbursed if they lose money buying newly issued shares in a bid to boost confidence in IPOs, a report said Thursday.
January 4, 2013, 3:17 pm TWN
The Securities and Exchange Board of India is seeking to convince small investors to put money into initial public offerings (IPOs) after volatile flotations prompted suspicions of price manipulation, the Wall Street Journal said.
The lack of confidence in share flotations — only a tiny minority of Indians currently put their savings into stocks — means companies are deprived of a huge amount of potential funding for investments.
The regulator has reportedly proposed a rule that would give refunds to investors who apply of up to 50,000 rupees (US$920) after IPOs that fall sharply.