Starting July 1, all DRHP (draft red herring prospectus) of public issues will make salient disclosures in audio visual (A/V) format on voluntary basis, capital markets regulator Securities Exchange Board of India (Sebi) directed in a circular recently.
Three months thereafter, these disclosures will have to be made on mandatory basis with effect from October 1, 2024, the circular further noted.
Sebi issued the latest guidelines in view of the comments received from various stakeholders for ease in understanding the features of public issues. Sebi had issued a draft circular to invite comments of the public on March 19, 2024.
The latest Sebi circular now stipulated that such audio visuals will be prepared and placed in the public domain for all main board public issues. This will initially be in bilingual format i.e., in English as well as Hindi. The Hindi version will carry text in Devanagari script.
The audio-visual presentation will make a disclosure to investors that they are advised not to rely on any other document, content or information provided in respect to the public issue anywhere else including on Internet/ websites/ social media channels or micro-blogging platforms by fin-fluencers.
The disclosure will also tell investors that they are advised to rely only on the information contained in the offer document and price band advertisement for making investment decision.
Key details of the content:
I. The duration of each version (English and Hindi) will be around 10 minutes.
II. The content of the presentation must be factual, non-repetitive, non-promotional and will not be misleading in any manner.
III. The time duration will be equitably distributed to cover disclosures made under various sections of the DRHP and RHP about the company, risk factors, capital structure, objects of the offer, business of the issuer, promoters, management, summary of financial information, litigations, material developments and terms of the offer etc.
Other key points about the audio/ visual presentation:
1 The audio video presentation will be made available on digital/ social media platforms of the issue and AIBI (Association of Investment Bankers of India).
2 The A/V link will also be shared on the websites of stock exchanges and lead managers to the issue.
3 The A/V will be made accessible through QR code pertaining to the public issue.
4. The A/V will be updated with information disclosed in RHP/ Prospectus and price band advertisement including details of the issue opening/ closing date, price/ price band etc and uploaded on the date of publication of the price band advertisement or the date of filing of prospectus.
5. The presentation will be uploaded on the portal of the Issuer and AIBI within five working days of the filing of DRHP with Sebi.
