Issue of Capital And

Disclosure Requirements
PPT - 4
 Application

• Public Issue

• Right Issue

• Bonus Shares

• Indian depository receipts

 Types Of Issue
• Public issue

• Initial public offer

• Further public offer

• Right Issue

• Bonus issue
 Types Of Issue

• Private placement
• Preferential allotment
• Qualified Institutional placement
 Introduction
• Appointment of a merchant banker or other intermediary

• Issue of shares is a process involving co-ordination of activities and co-operation

of number of agencies

• Process divided into 2 parts

• Pre issue-

• All activities from planning of capital to opening of the subscription list

• Post issue-

• All activities subsequent to opening of the subscription list

 Offer Documents
• Draft offer Document

• Offer Document

• Red Herring prospectus

 SEBI Compliances
• Issue of securities in dematerialized form
• Security Deposit
• Partly paid-up shares
• Promoters contribution to be brought in before
Public issue

•
 Underwriting

• Agreement with or without conditions to

subscribe to securities of a body corporate,
when the existing shareholders the public do
not subscribe to the securities offered to
them.

• Underwriting of the issue

 Issue
• Issue Opening Date

• Period of Subscription

• Minimum number of share applications and application

money

• Advertisement

• Mandatory collection centres

• Minimum subscription
 Issue

• Co ordination with intermediaries

• Due Diligence
• Allotment of Securities
• Despatch of letter of allotment and share certificate
• Redressal of Investors Complaint
 Procedure for issue of
Securities
• Compliance with SEBI Regulations

• Holding of General Meeting

• Appointment of Managers to the Issue

• Appointment of various other agencies

• Drafting of Prospectus

• Intimation to Stock Exchange

 Procedure for issue of
Securities
• Approval of Prospectus

• Approval of board of directors to prospectus and other

documents

• Making application to stock exchange for permission

to listing

• Printing and distribution of Prospectus and application

forms

• Pricing
 Eligibility Norms for Public
Issue
• Unlisted Companies

• Shares are not available to general public for trading and not listed to stock exchanges.

• Can make a IPO

• If net tangible assets of Rs. 3 crores for the preceding 3 full years of which not more than 50 % held inmonetary
assets

• Minimum average pre tax operating profit of Rs 15 crore

• Net worth of Rs 1 crore for preceding 3 years

• The aggregate of the proposed issue and all previous issues made in the same financial year does not exceed its
pre issue net worth of last financial year

Or

• If the issuer does not fulfill the above conditions

• Public offer should be through book building process or

• 15% by Financial institutions/ scheduled commercial banks & 10% to be allowed to QIB
And
Minimum post issue face value capital of company shall be 10 crores or
Compulsory market making for at least 2 years from date of the listing of shares.
Thank You

Dr. Medha Shetye