The Moscow Stock Exchange proposed that the Central Bank of the Russian Federation encourage issuers to conduct IPOs by extending the national project “Small and Medium Enterprises” until 2030 and expanding its coverage to SMEs with revenues of up to 10 billion rubles. In addition, the Moscow Exchange proposes to create a “line of pre-IPO funds” to provide pre-IPO financing to potential issuers – companies “with investment potential.”
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The director of interaction with issuers and stock market authorities, Elena Kuritsyna, sent the corresponding letter to the Service for the Protection of Consumer Rights and Guarantee of the Availability of Financial Services of the Central Bank, Interfax reports.
The Central Bank of the Russian Federation confirmed to the agency that it had received the letter and stated that the proposals would be considered in due course.
In particular, the letter states that the work of the national project “Small and Medium Enterprises” had already given good results: the total volume of initial bond offerings among small and medium-sized enterprises increased to 34 billion rubles between 2019 and 2023.
The Moscow Stock Exchange recommends consolidating the results achieved and expanding measures of state support for SMEs so that companies with small revenues of up to 10 billion rubles, and especially in the technology sector, more actively enter the stock market.
Today, the entry of fast-growing companies into IPOs is hampered by restrictions on subsidies: only those SMEs that employ no more than 250 employees and whose revenue does not exceed 2 billion rubles can receive benefits. The possibility of raising this threshold, according to stock market analysts, will attract more companies with clear investment potential to the idea of an initial placement.
In parallel, the Moscow Stock Exchange recommends offering tax benefits to investors so that IPOs of new issuers are in demand: for example, exempting citizens from paying personal income tax on dividends on shares of Russian companies purchased on IIS or on the proceeds from the sale of IPO Shares after continuous annual ownership.
As additional incentive measures, the Moscow Exchange is also considering the possibility of increasing the tax deduction to cover the costs of organizing an IPO and creating pre-IPO funds to attract pre-IPO financing.
“This need can be met by creating a line of pre-IPO funds as a high-quality infrastructure to prepare issuers for IPOs of companies with investment potential,” Interfax quotes a letter from the Moscow Stock Exchange.
Author:
Ekaterina Alipova
Source: RB
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