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Detailed requirements for startups to migrate from Innovators Growth Platform

SEBI incorporated a framework for Innovators Growth platform (“IGP”) with a vision to facilitate listing of start-ups in India. This was done by introducing amendments under the Securities and Exchange Board (Issue of Capital and Disclosure Requirements) Regulations 2018 (“ICDR Regulations”). IGP was introduced by an overhaul of the Institutional Trading Platform on the basis of recommendations put forth by a Committee of experts. On September 23, 2019, further amendments were introduced to the ICDR Regulations, mainly by substituting Regulation 292 which concerns an issuer’s migration from IGP to the Main Board.

What’s new?

The earlier Regulation 292 provided that the issuer can migrate from IGP to the main board of the recognized stock exchange, on whose IGP it has listed specified securities. The issuer could do so after the expiry of three years from the date of listing and subject to compliance with the eligibility requirements of the stock exchange.

The amended Regulation 292 de facto provides that the issuer can migrate from IGP to main board after completion of one year. It also provides various other detailed conditions in addition to the conditions prescribed by the stock exchange. These include that the issuer company must have a minimum of two hundred shareholders while applying for migration and neither the company nor any of its promoters or directors should either be barred from accessing capital markets or be promoter or director of any company that is barred from the same. Further, the issuer is placed with the disqualification from migrating if its promoters or directors are either wilful defaulters or fugitive economic offenders.

Eligibility requirements

  • A minimum net tangible asset of INR 3 Crore, calculated on a consolidated basis, in each of the preceding three years, of which, at most fifty per cent are held in monetary assets.

  • An average operating profit of INR 15 Crores, calculated on a consolidated basis during the preceding three years.

In case the issuer company has changed its name within last one year, at least fifty per cent of the revenue calculated on a consolidated basis for the preceding one full year has been earned by it from the activity indicated by its new name.

A company not satisfying the eligibility requirements can still apply to trade under the regular category, provided it has seventy-five per cent of its capital, as on the date of application for migration, held by Qualified Institutional Buyers.

Minimum promoters’ contribution

The promoters of the company need to hold at least twenty per cent of the total capital. Allowing, AIFs, FVCIs or Scheduled commercial banks or public financial institutions or insurance companies registered with IRDAI to contribute to meet the said shortfall, subject to a maximum of ten per cent of the total capital without being identified as promoter(s).[1]

Lock-in period

The said minimum promoters contribution is bound by a lock-in period of three years from the date on which trading approval in regular category of main board is granted, and any excess over and above the 20% of promoter holding is bound by lock-in period of six months at the time of listing of shares of the company on the IGP. For a company is desirous of migrating to regular trade category of main board after completion of listing on IGP for one year, such period shall be deducted from the stipulated lock-in requirement of three years as may be applicable.[2]

Other changes brought in include streamlining of ICDR to incorporate the amendments.


[1] This condition does not apply in case a company does not have any identifiable promoters.

[2] The condition of lock-in does not apply to a company listed on IGP for three years or more.

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