The Bank of Russia has identified the prospects for regulating the IPO market. The changes are planned to be prepared by the end of 2025. This is reported on the regulator's website.
The first part of the changes is aimed at adapting the information disclosed by issuers to the needs of investors. The summary of the securities prospectus is planned to be transformed into a short and understandable document, which reflects financial indicators in comparison with previous periods, a description of the company's development strategy, information on the dividend policy and other key information. The securities prospectus will need to include forecast figures for the coming year.
Companies will have to disclose information about the planned and actual distribution of shares among buyers, restrictions on the sale of securities by the issuer and current shareholders, as well as the mechanisms used to stabilize the share price to reduce their volatility after the IPO.
The Central Bank intends to establish a new listing condition. When entering the IPO, the issuer must submit at least two independent analytical reports with an assessment of the fair value of the company. They can be prepared by professional participants or auditing organizations in the financial market. In their reports, they should reflect all the essential information about the company: the current market position and performance, prospects and forecasts of development, possible risks. At the same time, they should justify the methodology of their assessment. As a result, retail investors will have access to high-quality analytics to make informed decisions.
For third-tier companies, an additional guarantee of the reliability of information and the quality of the preparation of issue documentation will be the organizations involved in providing services for the preparation of a securities prospectus or the organization of an offering.
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