The Securities and Exchange Board of India (Sebi) has cautioned investors against platforms that facilitate transactions in unlisted securities of public limited companies.
“It has come to the notice of Sebi that certain electronic platforms and/or websites are facilitating transactions in unlisted securities of public limited companies. Such activities are in violation of…laws designed to regulate and protect the interest of investors in the securities market,” the regulator said in a press release on Monday.
Sebi said that only recognized stock exchanges are authorised to provide a platform for fundraising and trading in securities of “to be listed” and “listed” companies. An example of this is the IPO grey market, which is often referred to by investors before applying for a public offering of a company to gauge the premium likely on the listing.
The regulator has cautioned investors about the absence of any resource such as Sebi’s grievance redressal mechanisms and online dispute resolution mechanism, with regards to such electronic platforms facilitating trading of unlisted shares.