CIRCULAR
SEBI/HO/CFD/SSEP/CIR/P/2022/66 May 19, 2022
To
All Recognized Stock Exchanges (except Commodity Exchanges)
All Recognized Depositories
Issuer Companies
Registered Stock Brokers
Registered Merchant Bankers
Registered Registrars to an Issue and Share Transfer Agents
Registered Depository Participants
Registered Bankers to an Issue
Dear Sir / Madam,
Sub: Streamlining the Process of Rights Issue
1. SEBI vide Circular No. SEBI/HO/CFD/DIL2/CIR/P/2020/13 dated January 22, 2020, had
stipulated procedures streamlining the Rights Issue process (‘the circular’).
2. In respect of the aforesaid circular, para 1.4.1 and at Annexure I para C (e) of the Circular, deal
with the requirement regarding minimum time period between closure of trading in Right
Entitlements on stock exchange platform and closure of the rights issue, which requires trading
in REs on the secondary market platform of stock exchanges commence along with the opening
of the rights issue and has to be closed at least four days prior to the closure of the rights issue.
3. SEBI received market representation that in case there are trading holidays between last date of
REs trading date and issue closure, provision of minimum gap of four days may not always
ensure that there are adequate days for settlement, as minimum 2 working days are required for
settlement of REs traded on last day of REs trading window (REs traded on exchange platform
have T+2 rolling settlement). It was further represented that there should be a minimum gap of
three working days considering two days for settlement and one additional day for investor to
make application in Rights Issue.
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4. Therefore, in view of above it has been decided that para 1.4.1 and at Annexure I para C (e) of
the Circular paragraphs are amended as under:
The words ‘at least four days’ are replaced with ‘at least three working days’.
5. Applicability of this Circular: This circular shall be applicable for all rights issues and fast track
rights issue with immediate effect.
6. All entities involved in the Rights Issue process are advised to take necessary steps to ensure
compliance with this circular.
7. The recognized stock exchanges are directed to bring the provisions of this circular to the notice
of the listed companies and also to disseminate the same on their website
8. This circular is being issued in exercise of the powers under section 11 read with section 11A of
the Securities and Exchange Board of India Act, 1992.
9. A copy of this circular is available on SEBI website at www.sebi.gov.in under the categories
“Legal Framework/Circulars”.
Yours faithfully,
Vandana Joglekar
Deputy General Manager
Corporation Finance Department
+91 22 2644 9639
Email - vandanaj@sebi.gov.in
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