B Mirror Report: The Bangladesh Securities and Exchange Commission (BSEC) has moved to significantly reduce the quota of shares allotted to general investors in initial public offerings (IPOs).

Currently, general investors receive 70 percent of the total quota in both fixed price and book-building IPOs. However, under the draft **Public Offer of Equity Securities Rules 2025**, BSEC has proposed cutting this share by half. The draft rules, recently published by the commission, are now open for public feedback before being finalized.

According to the draft, for fixed price IPOs, quota distribution would be as follows: Under the existing **Public Issue Rules 2015** (amended up to August 2021), general investors enjoy a 70% quota, with 20% for EIs, 5% for mutual funds, and 5% for NRBs.

Currently, EIs and mutual funds together hold 25%, NRBs 5%, and general investors 70%. The draft also introduces a **180-day lock-in** period for EIs allotted shares through the book-building method—a new provision absent in the current rules.

The draft rules stipulate that stock exchanges must recommend approval or rejection of IPO listing applications within 45 days of receipt. If an exchange issues a negative recommendation, the IPO will be considered for bidding.

Changes have also been proposed to lock-in provisions. At present, entrepreneurs, directors, and shareholders owning over 10% of shares are subject to a three-year lock-in. Shares issued to others at least four years before IPO approval are locked for one year.

The draft reduces that issuance period from four years to three, keeping the one-year lock-in unchanged. It also formally introduces the **180-day lock-in** for EIs under book-building IPOs.

The proposed rules retain the minimum offer sizes: Tk 30 crore for fixed price IPOs and Tk 75 crore for book-building IPOs.

Additionally, issue managers must now submit monthly reports to BSEC detailing whether the funds raised through IPOs are being utilized according to the approved prospectus.