Académique Documents
Professionnel Documents
Culture Documents
Private placement
Identified by BOD
Not exceeding 200
Excluded
o QIB
o Employes
IPO
Net tangible asset of at least 3 cr in each of the preceding three full years
not more than 50% are held in monetary assets(not be applicable in case the public offer is
made entirely through offer for sale.)
min of 15 cr as pre op tax profit in at least three years of the immediately preceding five years.
NW of 1 cr in each of the preceding three full years.
change in the company’s name, at least 50% of the revenue for preceding one year should be
from the new activity denoted by the new name
The issue size should not exceed 5 times the pre-issue net worth
OR
Issue shall be through book building route, with at least 75% of net offer to the public to be
mandatory allotted to the Qualified Institutional Buyers (QIBs)
Note
Allotment should be more than 1000
Earlier it was mandatory to grade the prospectus but now it is optional
Share should be held for 1 yr prior to filing of offer doc for offer for sale
Anchor Investor
Only in case of IPO
QIB –value of 10 cr book building process
25% upfront and 75% 2 days prior to closure of issue
30 days lock in period
60% available to QIB allotted to Anchor Invest
1/3rd reserved to domestic MF
Cannot be related to promoter or grp or lead managers
Deferential pricing
Retail investor/shareholders or employees
Investment not more than 2 lac
Discount max 10% of issue price
Composite issue
Rts issue or public issue
There is price diff in both the issue
Justification should be given
Price band
Cap less than 120% of floor price
Diff between floor and final price not more than 20%
Face value
If price is 500 or more then Fv can be less than 10
If 500 or less then Fv shall be rs 10
Does not apply to IPO of govt co,stat authority SPV set up any of them engaged in infra sector
Who is promoter
-control over affairs directly or indirectly
-instrumental in planning of offer ss to public
-named in the offer docor annual report
-accordance with whose advice ,director or Bod act
Merely as a professional capacity is not a promoter
Promoter grp
-promoter and imme relative
-body corporate 20% or more holding of the promoter
Financial Institutions, Scheduled banks, foreign Portfolio Investors & MF are not included in promoter
grp
QIB
MF, venture cap ,foreign venture cap
FII and sub account
Public fin inst
Pension corpus min 25cr
Provident fund min 25Cr
Commercial banks
Insurance co reg with IRDA
State industrial development corp
National investment fund
Convertible debt ins –tenure not more than 18 months from date of allotment
ASBA
Anchor investor aren’t permitted
block the application money in a Bank Account
Public Shareholding
Held by Public
DRs( with voting rights listed in intl stock exchange)
Employee benefit scheme are excluded from Public shareholding
Min Public shareholding is 25% of each class of SS
Period of subscription
3 days and not more than 10 days
Extention of min 3days but not more than 10 days
Min Application value -10000 to 15000 and not less than 25% of issue price
Prospectus
Relevant info
True nature of the company
No inducing statement like market leaders ,leading players
Easy to understand
Letter of Offer is for rights issue
RHP SP Info Memo. is for public issue
SPA
Bonus shares
Write off Preliminary exp, expenses of, or the commission paid or discount allowed on, any issue
of shares or debentures of the company
premium payable on redemption of any redeemable preference shares or deb
buyback
Sweat eq share
to director and employee for consideration other than cash at a discount from Mk price
within a period of 12 months of the date of special resolution
15% of eq cap or 5cr which ever is high
Lock in for a period of 3 yr
No of shares ,CMP,consideration,same classes which are issued
One year should have elapsed from commencement of business
Listed on recog stk ex then sebi if not co act is to be followed
Rt issue
Existing eq shareholders
Letter of offer to be sent by any means but a proof of delivery should be there as per co act
and should be sent before 3 days of issue
Min 15 max 30 days if offer not accepted within this time it is deemed as declined
Renounce the share to any other person
If not accepted or renounced can be disposed of by the Board of Directors in a manner which
is not disadvantageous to the shareholders and the Company
Listed issuer decides the record date ,cannot withdraw rt issue after record date
If withdrawn cannot issue ss for 12 months
In case the issuer has outstanding convertible ss floating in the market then it has to reserve
the required shares which will be available for them at the time of conversion at the same
price offered at the time of the right issue.
issue price should be decided before record date, in consultation with designated stock
exchange
payment option full or part
Bonus shares
out of a) Free reserves
b)the Securities Premium Account and
c)the Capital Redemption Reserve Account
reserves created out of revaluation of assets cannot be used
authorized by aoa
ordinary resolution with recommendation of Bod
has not defaulted in int or principle
has not defaulted in payment of statutory payments
partly pd up should be fully pd up
cannot be issued at discount
can be issued without adj losses
cannot withdraw the decision with recommendation of board
THE BONUS SHARES SHALL NOT BE ISSUED IN LIEU OF DIVIDEND
Bonus issue should be implemented within 2 months within the board meeting subject to
shareholders approval
Buyback
Authorized by AOA
By – free reserves , spa ,and capital r res, and proceeds of other issue of an other class
Special resolution should be passed but if its below 10 % of (equity share cap + free reserve )
then the BOD can take a call
Max limit to buy back is 25 % ( paid up share cap + free reserve ) at the time of buy back and in
general not more than 25 % of the total Paid up share cap
The companys debt should not exceed 2 X of ( paid up share cap + free reserve ) AFTER the
BUY BACK , the central govt will give different ratios for different classes of company s
Fully pd up
Buy back from existing shareholder, open market & ESOPs