The Securities and Exchange Board of India is considering allowing ’when-listed’ securities to trade on stock exchanges, as investors seek opportunities during the IPO listing process.

India’s securities market regulator is considering steps to formalize trading in initial public offerings where bidding has closed, but the shares are yet to be listed.

SEBI is working on introducing a new system that allows trading in shares of companies that are in the process of listing.

As per regulations, firms launching IPOs have to ensure that listing happens in three days of the issue closing

The Securities and Exchange Board of India (SEBI) is considering creating a platform to allow stock allottees to trade their shares, before they are officially listed on stock exchanges. SEBI Chairperson Madhabi Puri Buch revealed the initiative at an event today.

Sebi is looking at introducing a system where an investor can sell shares as soon as they are allotted in an Initial Public Offering (IPO) to curb grey market activity, chairperson Madhabi Puri Buch said on Tuesday.

If implemented, this would open the trading window for investors even before a company’s IPO is listed on NSE, BSE. At present, there is a three-day gap between the closure of an IPO and the listing of shares.