Preferential Issue: SEBI Weighted Average Price Concept

Market regulator Securities & Exchange Board of India (SEBI) has tweaked the pricing formula for ‘preferential issues’ with the intent of using a more representative price in such share sales. Henceforth, ‘volume weighted average price’ (VWAP) would be used as a parameter for pricing the preferential issues as against the current requirement of using the ‘closing price’.