The Securities and Exchange Board of India (SEBI) has held back the IPO papers of HDB Financial Services, a HDFC Bank subsidiary, for four months, the report cited sources as saying.
The market regulator delayed the as the share sales by the large non-banking financial firms may inadvertently violate rules related to the sale of pre-IPO shares, the report said.
Under the Companies Act, unlisted companies cannot add more than 200 shareholders in a financial year. These firms cannot also sell shares via private placement to more than 50 persons at a time. If shares are issued through private placement to public shareholders within six months, then it is considered a public issue.
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