Executive Summary:
This circular from the Securities and Exchange Board of India (SEBI) mandates the use of Audio Visual (AV) presentations for key disclosures in public issue offer documents to enhance investor awareness. Initially bilingual (English and Hindi), these AVs must be factual, non-promotional, and approximately 10 minutes long. The rule is voluntary from July 1, 2024, and mandatory from October 1, 2024, for DRHPs filed with SEBI.
Key Points / Main Content:
AV Presentation Requirements:
* Salient disclosures from DRHP, RHP, and Price Band Advertisements must be presented in AV format.
* AVs must be bilingual (English and Hindi with Devanagari script).
* Each bilingual version should be approximately 10 minutes long, covering company information, risk factors, capital structure, offer objectives, business details, promoters, management, financial summary, litigations, material developments, and offer terms.
* Content must be factual, non-repetitive, non-promotional, and not misleading, complying with Schedule IX of SEBI ICDR Regulations, 2018.
* AVs must include a disclaimer advising investors to rely solely on official offer documents and price band advertisements, avoiding unauthorized online information.
Uploading and Accessibility:
* AVs must be uploaded within 5 working days of filing the DRHP with SEBI on the Issuer's and AIBI's websites. For pre-filing, AVs must be available within 5 days of filing Updated Draft Red Herring Prospectus I.
* The AVs must also be available on the Issuer's and AIBI's digital/social media platforms.
* Web links must be on the Stock Exchanges' and Lead Managers' websites.
* QR codes in offer-related documents must link to the AV.
Updates and Responsibility:
* AVs must be updated with RHP/Prospectus and price band advertisement information (issue dates, price band) upon publication of the price band advertisement or filing of the prospectus.
* Issuers and Lead Managers are responsible for the AV content and information.
Applicability:
* Voluntary for DRHPs filed on or after July 1, 2024.
* Mandatory for DRHPs filed on or after October 1, 2024.
Impact Analysis:
Issuers:
* Impact: Required to create and disseminate AV presentations of offer documents and ensure accuracy.
* Action Required: Prepare AV presentations, upload them to their website and social media platforms, and ensure they are updated with relevant information.
Lead Managers:
* Impact: Responsible for the content of the AV and for providing links to the AV on their websites.
* Action Required: Ensure the accuracy of AV content, coordinate with issuers, and provide necessary web links.
Investors:
* Impact: Intended to benefit from clearer, more accessible information about public issues, and to be cautioned against unofficial sources.
* Action Required: Utilize AV presentations to better understand public offerings and rely on official offer documents for investment decisions.
Association of Investment Bankers of India (AIBI):
* Impact: Required to host the AV presentations on its website and social media platforms.
* Action Required: Upload and maintain AV presentations on its website and social media platforms.
Stock Exchanges:
* Impact: Required to provide links to the AV on their websites.
* Action Required: Provide web links to the AV presentations on their websites.
Key Entities Referenced
Securities and Exchange Board of India (SEBI): Regulatory body for the securities market in India. The circular is issued by SEBI.
Association of Investment Bankers of India (AIBI): An association of investment bankers in India, responsible for uploading the AV.
Draft Red Herring Prospectus (DRHP): A document containing preliminary information about a company's public offering.
Red Herring Prospectus (RHP): A revised version of the DRHP that includes additional information, such as the price band.
SEBI Issue of Capital and Disclosure Requirements Regulations, 2018: Regulations governing the issuance of capital and disclosure requirements for companies.
Securities and Exchange Board of India Act, 1992: The act of parliament that established SEBI and defines its powers.
Recognized Stock Exchanges: Stock exchanges in India that are recognized by SEBI.
Registered Merchant Bankers: Merchant bankers registered with SEBI.
SEBI/HO/CFD/CFD-TPD-1/P/CIR/2024/55 May 24, 2024
To
Recognized Stock Exchanges
Registered Merchant Bankers
Association of Investment Bankers of India (AIBI)
Dear Sir / Madam,
Sub: Audiovisual (AV) presentation of disclosures made in Public Issue Offer
Documents
1. In order to create awareness among investors to not rely on unauthorized/unsolicited
information about public issues, a draft of this circular on the captioned subject was
placed on SEBI website for public comments on March 19, 2024.
2. Based on comments received from various stakeholders, it has been decided that
salient disclosures made in the Draft Red Herring Prospectus (DRHP), Red Herring
Prospects (RHP) and Price Band Advertisement for public issues shall also be made
available in Audio Visual format (AV) for ease in understanding the features of public
issues. Such AV shall be prepared and placed in the public domain for all main board
public issues. The same shall initially be in bilingual format i.e. English and Hindi. The
Hindi version shall contain text in Devanagari script.
3. The contents of the AV shall be as per the following guidelines –
3.1. AV to be in compliance with the provisions regarding “Public communications
and publicity materials” prescribed under Schedule IX of SEBI (Issue of Capital
and Disclosure Requirements) Regulations, 2018.
3.2. It shall contain the following disclosure to investors –
“Investors are advised not to rely on any other document, content or information
provided in respect to the public issue on the internet/online websites/social
media platforms/micro-blogging platforms by finfluencers.
Investors are advised to rely only on the information contained in the Offer
document and Price Band Advertisement for making investment decision.”
Page 1 of 33.3. The duration of each bilingual version of the AV shall be approximately 10
minutes.
3.4. The total duration of the AV shall be equitably distributed to cover material
disclosures made under various sections of the DRHP and RHP viz. about the
company, risk factors, capital structure, objects of the offer, business of the
issuer, promoters, management, summary of financial information, litigations,
material developments and terms of the offer etc.
3.5. The content of the AV must be factual, non-repetitive, non-promotional and shall
not be misleading in any manner.
4. The AV shall be uploaded on the website of the Issuer and Association of Investment
Bankers of India (AIBI) within 5 working days of the filing of DRHP with SEBI. In case
of pre-filing of draft offer document under CHAPTER IIA of SEBI (Issue of Capital and
Disclosure Requirements) Regulations, 2018, the AV shall be made available within
5 working days of filing Updated Draft Red Herring Prospectus -I, as defined under
Clause 59A of SEBI (Issue of Capital and Disclosure Requirements) Regulations,
2018.
5. The AV shall also be made available on digital/social media platforms of the Issuer
and AIBI. The web link of the said AV shall be made available on the websites of the
Stock Exchanges and the Lead Managers to the issue. The AV shall be made
accessible through QR code (as made available in offer related documents)
pertaining to the public issue.
6. The AV shall be updated with information disclosed in RHP/ Prospectus and price
band advertisement including details of the issue opening/closing date, price/ price-
band etc., and uploaded on the date of publication of the price band advertisement
or the date of filing of prospectus (in case of fixed price issues).
7. The Issuer and all Lead Managers to the public issue shall be responsible for the
content and information made available in the AV.
Applicability of this circular
8. The provisions of this circular shall be made applicable to all DRHP filed with SEBI-
i. On or after July 01, 2024 on Voluntary basis;
ii. October 01, 2024 onwards on Mandatory basis;
Page 2 of 39. This Circular is being issued in exercise of the powers conferred under Section 11
and Section 11A of the Securities and Exchange Board of India Act, 1992 to protect
the interests of investors in securities and to promote the development of, and to
regulate the securities market.
10. This circular is available on SEBI website at www.sebi.gov.in under the category:
‘Legal → Circulars’.
Yours faithfully,
E Balasubramanian
General Manager
Corporation Finance Department
Phone: +91-022-26449195
Email: ebala@sebi.gov.in
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