Government monitoring end use of funds raised through IPO to prevent fund diversion

Mar 29, 2010

Corporate affairs minister Salman Khurshid said his ministry is studying ways to prevent over-pricing of initial public offers and monitoring the end use of funds raised through IPOs to prevent fund diversion.Khurshid also said his ministry is examining the report of the expert group to suggest steps for monitoring the end use of IPO funds.

“The report of the expert group has been submitted. We will certainly read the report carefully. But we can only tell you the finding after we finish reading it,” Khurshid said.

Set up in August 2008, the expert group was to analyse the loopholes in the mechanism used to scrutinise how money raised through IPOs is utilised. The group comprised ministry officials and representatives from Sebi and BSE and NSE.