Sebi is overly focused on the interests of retail investors. This results in lopsided rules.
Securities and Exchange Board of India (Sebi) has sought public comments on its proposal to have a mandatory “safety net" to protect the interests of small investors. Sebi’s view is that apart from disclosures, other measures are needed to bring in self-discipline in the pricing of initial public offerings (IPOs) and having a safety net mechanism is one such measure it has proposed. If implemented, issuers will have to buy back up to 5% of an IPO issuance from investors who put in applications worth 50,000 or less, in case the price of their shares fall by more than 20% relative to a broad market index.