Securities and Exchange Board of India’s (SEBI) Master Circular on the Issue of Capital and Disclosure Requirements. SEBI’s Master Circular on the Issue of Capital and Disclosure Requirements provides a comprehensive guide to compliance and regulations in the Indian securities market. It covers various aspects such as non-compliance penalties, rights issues, disclosures, online filing, and compensation to investors. Market participants, including registered merchant bankers, recognized stock exchanges, and listed entities, should familiarize themselves with this circular to ensure compliance with SEBI guidelines and enhance investor protection.
Securities and Exchange Board of India
Master Circular No. SEBI/HO/CFD/PoD-2/P/CI R/2023/00094 Dated: June 21, 2023
To
Registered Merchant Bankers
Recognized Stock Exchanges
Depositories and Registered Depository Participants
Registered Registrars to an Issue and Share Transfer agents
Registered Stock Brokers
Bankers to an Issue (Self-Certified Syndicate Banks-SCSB)
Listed Entities
Dear Sir / Madam,
Subject: Master Circular for Issue of Capital and Disclosure Requirements
1. The Securities and Exchange Board of India (“SEBI” or “the Board”) has been, from time to time, issuing various circulars/directions under the relevant provisions of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 (“ICDR Regulations 2018”). In order to enable the stakeholders to have access to all such circulars at one place, this Master Circular under the ICDR Regulations 2018 has been prepared.
2. With the issuance of this Master Circular, the directions/instructions contained in the circulars listed out in the Appendix to this Master Circular shall stand
3. Notwithstanding such rescission, –
(a) anything done or any action taken or purported to have been done or taken under the rescinded circulars, prior to such rescission, shall be deemed to have been done or taken under the corresponding provisions of this Master Circular;
(b) any application made to the Board under the rescinded circulars, prior to such rescission, and pending before it shall be deemed to have been made under the corresponding provisions of these regulations;
4. This Master Circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992.
5. This Master Circular is available on the website of SEBI at sebi.gov.in. Yours faithfully,
Yogita Jadhav
General Manager
Division of Policy and Development
Corporation Finance Department
Phone + 91-022-26449583
Email: [email protected]
| List of Abbreviations | 4 |
| Chapter 1: Non-compliance with certain provision of SEBI ICDR Regulations 2018 | 5 |
| Chapter 2: Streamlining the process of Rights Issue | 7 |
| Chapter 3: Disclosures in offer document | 9 |
| Chapter 4: Online Filing System | 11 |
| Chapter 5: Compensation to Retail Individual Investors (RIIs) in an IPO | 12 |
| Chapter 6: Guidelines on issuance of non-convertible debt instruments along with warrants (‘NCDs with Warrants’) in terms of Chapter VI – Qualified Institutions Placement of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 | 14 |
| Chapter 7: Framework for the process of recognition of investors for the purpose of Innovators Growth Platform | 15 |
| Chapter 8: Issue Summary Document (ISD) and dissemination of issue advertisements | |
| Annexure I | 20 |
| Annexure II | 24 |
| Annexure III | 32 |
| Annexure IV | 33 |
| Annexure V | 34 |
| Annexure VI | 37 |
| Appendix | 61 |
List of Abbreviations
| ASBA | Application Supported By Blocked Amount |
| ADR | American Depository Receipts |
| BRLM | Book Running Lead Manager |
| BTI | Bankers to Issue |
| DP | Depository Participant |
| EBP Platform | Electronic Book Provider Platform |
| FCCB | Foreign Currency Convertible Bonds |
| GDR | Global Depository Receipts |
| QIB | Qualified Institutional Buyer |
| ICDR Regulations 2018 | Issue of Capital and Disclosure Requirements, Regulations 2018 |
| IDR | Indian Depository Receipt |
| IGP | Innovators Growth Platform |
| IGPI | Innovators Growth Platform Investors |
| IPEF | Investor Protection and Education Fund |
| ISD | Issue Summary Document |
| ISIN | International Securities Identification Number |
| LODR Regulations 2015 | Listing Obligations and Disclosure Requirements Regulations, 2015 |
| KPIs | Key Performance Indicators |
| MBs | Merchant Bankers |
| NCD | Non-Convertible Debentures |
| NCS | Non-Convertible Securities |
| NII | Non-institutional Investors |
| OFS | Offer For Sale |
| PAN | Permanent Account Number |
| REs | Right Entitlements |
| RHP | Red Herring Prospectus |
| RII | Retail Individual Investor |
| RTA | Registrar and Transfer Agents |
| SCSB | Self-Certified Syndicate Banks |
| T-Day | Trading Day |
Chapter 1: Non-compliance with certain provision of SEBI ICDR Regulations 20181
1. Regulation 297 and 298 of ICDR Regulations 2018, inter-alia, specify liability of a listed entity or any other person for contravention and actions which can be taken by the respective stock exchange, the revocation of such actions and consequences for failure to pay fine in the manner specified by SEBI.
2. In pursuance of the above, for non-compliance with certain provisions of the ICDR Regulations 2018, stock exchanges shall impose fines on the listed entities, as under:
|
S. No. |
Violation | Regulation / Schedule | Fine |
| 1. | Delay in completion of a bonus issue:
(i) Within 15 days from the date of approval of the issue by its board of directors – in cases where areholders’ approvfor capitalization of profits or reserves for making the bonus issue is not required. (ii) Within 2 months from the date of the meeting of its board of directors wherein the decision to announce bonus issue was taken subject to shareholders’ approval – in cases where issuer is required to seek shareholders’ approval for capitalization of profits or |
295 (1) | ₹ 20,000 per day of noncompliance till the date of compliance. |
| 2. | Listed entities not completing the conversion of convertible securities and allotting the shares, within 18 months from the date of allotment of convertible securities. | 162 | Same as above. |
| 3. | As per Schedule XIX – Para (2) of ICDR Regulations 2018 under heading Application for listing, it is stated that: “The issuer shall make an application for listing, from the date of allotment, within such period as may be specified by the Board from time to time, to one or more recognized stock exchange(s)”. In regard to above, it is specified that Issuer shall make an application to the exchange/s for listing in case of further issue of equity shares from the date of allotment within 20 days (unless otherwise specified). | Schedule XIX – Listing of Securities on Stock Exchanges. |
Same as above. |
| 4. | Listed entities shall make an application for trading approval to the stock exchange/s within 7 working days from the date of grant of listing approval by the stock exchange/s. | – | Same as above. |
Credit of Fine:
3. The amount of fine realized as per the above structure shall continue to be credited to the “Investor Protection Fund” of the concened stock exchange.
4. The recognized stock exchange shall disseminate on their website the names of noncompliant listed entities that are liable to pay fine for non-compliance, the amount of fine imposed, details of fines received, etc.
5. The recognized stock exchange shall issue notices to the non-compliant listed entities to ensure compliance and collect fine as per this circular within 15 days from the date of such notice.
6. If any non-compliant listed entity fails to pay the fine, the recognized stock exchange may initiate appropriate enforcement action, including prosecution in furtherance of Regulation 298 of ICDR Regulations 2018.
Bonus Issue Delays:
7. With respect to bonus issue delays, it is clarified that:
7.1 The approvals for the listing and trading of promoters’ bonus shares may be granted by the Stock Exchange, only after payment of the requisite fine by the listed entity.
7.2 However, the approvals for the listing and trading of bonus shares allotted to persons other than the promoter(s) may be granted in the interest of the investors, subject to compliance with other requirements.
8. The Stock Exchanges may deviate from the abovementioned provisions, wherever the interest of the investors is not adversely affected, if found necessary, only after recording reasons in writing.
Chapter 2: Streamlining the process of Rights Issue2
1. Following are applicable for the Rights Issue process:
1.1. The period for advance notice to stock exchange(s) under Regulation 42(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations 2015”) shall be at least 3 working days (excluding the date of intimation and the record date).
1.2. Issuance of newspaper advertisement disclosing date of completion of dispatch and intimation of same to the stock exchanges for dissemination on their websites, as per Regulation 84 (1) of the ICDR Regulations 2018, shall be completed by the issuer at least 2 days before the date of opening of the issue.
1.3. With respect to dematerialized Rights Entitlements (REs) –
1.3.1. In the letter of offer and the abridged letter of offer, the issuer shall disclose the process of credit of REs in the demat account and renunciation thereof.
1.3.2. The REs with a separate ISIN shall be credited to the demat account of eligible shareholders in dematerialized form before the date of opening of the issue, against the shares held by them as on the record date.
1.3.3. Physical shareholders shall be required to provide their demat account details to Issuer / Registrar to the Issue for credit of REs not later than two working days prior to the issue closing date, such that credit of REs in their demat account takes place at least 1 day before the issue closing date.
1.4. Trading of dematerialized REs on stock exchange platform –
1.4.1. REs shall be traded on secondary market platform of stock exchanges, with T+1 rolling settlement, similar to the equity shares. Trading in REs on the secondary market platform of stock exchanges shall commence along with the opening of the issue and shall be closed at least three working days prior to the closure of the rights issue.
1.4.2. Investors holding REs in dematerialized mode shall be able to renounce their entitlements by trading on stock exchange platform or off-market transfer. Such trades will be settled by transferring dematerialized REs through depository mechanism, in the same manner as done for all other types of securities.
1.4.3. Payment mode – Application for a rights issue shall be made only through ASBA facility.
1.4.4. No withdrawal of application by any shareholder shall be permitted after the issue closing date.
2. The detailed procedures on the Rights Issue process are given at Annexure I for due compliance.
Chapter 3: Disclosures in offer document3
1. Disclosures in the abridged prospectus and front cover page of the offer document-
1.1. Disclosures in the Abridged Prospectus
1.1.1. In terms of Regulation 34(1) of the ICDR Regulations 2018, abridged prospectus shall contain the disclosures as specified in Annexure I of Part E of Schedule VI of the said regulations.
1.1.2. In order to further simplify, provide greater clarity and consistency in the disclosures across various documents and to provide additional but critical information in the abridged prospectus, the format for disclosures in the abridged prospectus has been revised and is placed at Annexure II of this Circular.
1.2. Disclosures in the front cover page of the offer document
1.2.1. Clause 1(a) of Part A – Schedule VI of the ICDR Regulations 2018 specifies information to be disclosed on the front outside cover page of offer document.
1.2.2. With regard to above, a format for disclosure on front outside cover page shall be as per the format placed at Annexure III of this Circular.
1.3. General Instructions
1.3.1. While the disclosures in the abridged prospectus shall be as per Annexure II of this Master Circular instead of Annexure I of Part E of Schedule VI of the ICDR Regulations 2018, the disclosure on front outside cover page shall be as per Annexure III of this Master Circular.
1.3.2. A copy of the abridged prospectus shall be made available on the website of issuer company, lead managers, registrar to an issuers and a link for downloading abridged prospectus shall be provided in price band advertisement.
1.3.3. The Issuer Company / Merchant Bankers (MBs) shall ensure that the disclosures in the abridged prospectus are adequate, accurate and does not contain any misleading or misstatement.
1.3.4. Furthermore, the Issuer Company/MBs shall ensure that the qualitative statements in the abridged prospectus shall be substantiated with Key Performance Indicators (KPIs) and other quantitative factors. Also, no qualitative statement shall be made which cannot be substantiated with KPIs.
1.3.5. Further, the issuer company/ MBs shall insert a Quick Response (QR) code on the front page of the documents such as front outside cover page, abridged prospectus, price band advertisement, etc. as deemed fit by them. The scan of QR code shall lead to downloading of prospectus, abridged prospectus and price band advertisement as applicable.
Chapter 4: Online Filing System
1. Online Filing System for Offer Documents, Schemes of Arrangement, Takeovers and Buy backs4
1.1 SEBI had introduced an online system for filings related to public issues, rights issues, institutional placement programme, schemes of arrangement, takeovers and buy backs.
1.2 All Merchant Bankers that are required to file the offer documents and related documents in physical form with SEBI shall simultaneously file the same online through SEBI Intermediary Portal at https://siportal.sebi.gov.in.
1.3 Recognized stock exchanges filing the draft scheme of arrangement and related documents in physical form with SEBI under the provisions of LODR Regulations 2015 shall simultaneously file the same online through SEBI Intermediary Portal at https://siportal.sebi.gov.in.
1.4 Link for SEBI Intermediary Portal is also available on SEBI website – www.sebi.gov.in. In case of any queries and clarifications, users may refer to the manual provided in the portal or contact the Portal Helpline at +9122-26449364 or email at [email protected].
Chapter 5: Compensation to Retail Individual Investors (RIIs) in an IPO 5
1. Applications Supported by Block Amount (ASBA) has resulted in almost complete elimination of complaints pertaining to refunds, there have been instances where the applicants in an Initial Public Offering have failed to get allotment of specified securities and in the process may have suffered an opportunity loss due to the following factors:
1.1 Failure on part of the Self Certified Syndicate Banks (SCSB) to make bids in the concerned Exchange system even after the amount has been blocked in the investors’iank account with such SCSB
1.2 Failure on part of the SCSB to process the ASBA applications even when they have been submitted within time.
1.3 Any other failures on part of an SCSB which has resulted in the rejection of the application form.
2. In order to have a uniform policy for calculation of minimum compensation payable to investors in scenarios as mentioned above in Para 1 a), b) and c), the following factors have been taken into account:
2.1 the opportunity loss suffered by the investor due to non-allotment of shares;
2.2 the number of times the issue was oversubscribed in the relevant category;
2.3 the probability of allotment; and
2.4 the listing gains if any on the day of listing.
3. The following formula is mandated for calculation of minimum fair compensation:
Compensation = (Listing price* – Issue Price) X No. of shares that would have been allotted if bid was successful X Probability of allotment of shares determined on the basis of allotment
*Listing price shall be taken as the highest of the opening prices on the day of listing across the recognized stock Exchanges.
The formula is explained with the help of an example in the Annexure IV to this circular.
4. In case of issues which are subscribed between 90-100%, i.e. non oversubscribed issues, the applicants would be compensated for all the shares which they would have been allotted.
5. No compensation would be payable to the applicant in case the listing price is below the issue price.
6. RTAs shall share the basis of allotment file, if sought by SCSB, so that the SCSB shall have access to the allotment ratio for the purpose of arriving at the
7. Any applicant whose application has not been considered for allotment, due to failure on the part of the SCSB, shall have the option to seek redressal of the same within three months of the listing date with the concerned SCSB. On receipt of such application/s, the SCSB would be required to resolve the same within 15 days, failing which it would have to pay interest at the rate of 15% per annum for any delay beyond the said period of 15 days.
8. In case the SCSB fail to redress such grievances within the stipulated time, additionally SEBI may initiate action as deemed fit.
9. The SCSB are required to submit the half yearly report to SEBI as per below format:
Half Yearly Report w.r.t No. of complaints received for compensation under
|
||||||
S. No |
Opening balance |
No. of
|
No. of complaints resolved |
Closing balance |
||
No. where compensation was paid with out interest |
No. where compensation was paid with interest |
No. where compensation was not required to be paid |
||||
Chapter 6: Guidelines on issuance of non-convertible debt instruments along with warrants (‘NCDs with Warrants’) in terms of Chapter VI – Qualified Institutions Placement of SEBI (Issue of Capital and Disclosure Requirements)
Regulations, 20186
1. In order to streamline procedure of issuance and applicability of Electronic Book Provider Platform (EBP Platform) mechanism on the ‘NCDs portion’ the following was decided and made applicable for issues wherein the size of NCDs portion is above threshold prescribed under the Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021 (“NCS Regulations 2021”) and Circulars issued there under:
1.1. EBP platform mechanism shall be mandatory for ‘NCDs portion’ of the issue (for both stapled and segregated offer) and issuer shall be required to comply with the NCS Regulations 2021, and Circulars issued there under.
1.2. ‘Warrants portion’ of the issue shall be in terms of Chapter VI on Qualified Institutions Placement under the ICDR Regulations 2018.
1.3. Of the ‘total issue size’ of the issue, at least 40% size shall consist of ‘Warrants portion’It may be noted that total issue sizeshall mean combined size of NCDs issue and the aggregate size of the warrants portion, including the conversion price of warrants.
2. The segregated offer of NCDs and stapled offer, both are exempted from the requirements as prescribed under the Regulations 175(3), 179(2)(a), 180(1) and 180(2) of the ICDR Regulations 2018.
Chapter 7: Framework for the process of recognition of investors for the purpose of Innovators Growth Platform7
1. Innovators Growth Platform Investors (“IGPIs”) for the limited purpose of Innovators Growth Platform (“IGP”), are investors whose holding in the Issuer Company, is eligible for the computation of at least 25% of the pre-issue capital in accordance with Regulation 283(1) of the ICDR Regulations 2018.
2. Accordingly, the framework for the process of recognition of investors as IGPI is detailed below:
A. Eligibility
The following entities shall be eligible to be considered as IGPIs:
i. An individual with total gross income of ₹ 50 lakhs annually and who has minimum liquid net worth of ₹ 5 crores; or
ii. A body corporate with net worth of ₹ 25 crores.
B. Procedure for Recognition
i. Responsibility of Stock Exchanges/Depositories The investor, having a demat account with a Depository, will make an application to the Stock Exchanges/Depositories in the manner prescribed by them for recognition as an IGPI. The Stock Exchanges /Depositories may use the services of Brokers/Depository participants respectively for such purpose. However, Stock Exchanges/Depositories shall be responsible for verification and maintenance of the IGPI data.
ii. Documentation Detailed Documentation required for recognition is provided at Annexure V of this master Circular.
3. Validity of Recognition
The recognition granted by the Stock Exchange/Depository shall be valid for a period of three years from the date of issue of such accreditation unless the IGPI becomes ineligible due to change in his/her/its financial status in which case such IGPI shall inform the Stock Exchange/Depository of such ineligibility.
4. Responsibility of Merchant Bankers at the time of listing on IGP with regard to IGPIs
At the time of application by a Company for listing on IGP, the merchant bankers shall ensure due diligence with regard to eligibility of IGPIs and that their holding in the Company desirous of listing on IGP is in accordance with the Regulation 283(1) of the ICDR Regulations 2018.
5. Stock Exchanges/Depositories are advised to make necessary amendments to the relevant bye-laws, rules and regulations.
Chapter 8: Issue Summary Document (ISD) and dissemination of issue advertisements8
1. In order to facilitate consumption of data by stakeholders such as researchers, policy makers, market analysts, and market participants, in respect of public issues, further issues, buyback, offers under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (“SEBI SAST Regulations”) and SEBI (Delisting of Equity Shares) Regulations2021 (“SEBI Delisting Regulations”), , it was decided to make available relevant information / data points at the Stock Exchanges and Depositories in a structured manner.
2. Accordingly, after consultation with the stakeholders, an Issue Summary Document (ISD) was designed. It was decided to introduce the ISD for the following, in XBRL (Extensible Business Reporting Language) format:
2.1 public issue of specified securities (initial public offer / further public offer);
2.2 further issues {preferential issue, qualified institutions placement (QIP), rights issue, issue of American Depository Receipts (ADR), Global Depository Receipts (GDR) and Foreign Currency Convertible Bonds (FCCBs)};
2.3 buy-back of equity shares (through tender offer or from the open market);
2.4 open offer under SEBI SAST Regulations;
2.5 voluntary delisting of equity shares where exit opportunity is required under
SEBI Delisting Regulations.
3. ISD shall be filed in two stages:
3.1 In the first stage, ISD will be filed containing pre-issue / offer fields.
3.2 In the second stage, ISD will be filed containing post-issue / offer fields after
allotment/offer is completed / as applicable for respective ISD.
4. The formats for ISD are placed as Table I to Table X in Annexure VI:
4.1 Table I: ISD for public issue of specified securities
4.2 Table II: ISD for preferential issue of specified securities
4.3 Table III: ISD for qualified institutions placement
4.4 Table IV: ISD for rights issue of specified securities
4.5 Table V: ISD for issue of American Depository Receipts (ADRs) / Global Depository Receipts (GDRs)
4.6 Table VI: ISD for issue of Foreign Currency Convertible Bonds (FCCBs)
4.7 Table VII: ISD for buy-back of equity shares through tender offer
4.8 Table VIII: ISD for buy-back of equity shares from the open market 4.9 Table IX: ISD for open offer under SEBI SAST Regulations
4.10 Table X: ISD for voluntary delisting of equity shares where exit opportunity is required.
5. The prescribed formats also provide timeline for submission of the details and also casts responsibility on the entity responsible for the submission (hereinafter referred to as “Submittng Entity”).
6. Stock Exchanges shall develop a utility in order to facilitate the filing of the ISD by Submitting Entity. The Submitting Entity may file the details, as applicable in the format mentioned at para 4 above, to any stock exchange where the securities of the entity, in relation to which the ISD is being filed, are listed / proposed to be listed.
7. The Stock Exchange which receives the ISD shall further transmit, as soon as possible, the information to other Stock Exchanges and Depositories for dissemination.
8. Dissemination on the websites of Stock Exchanges and Depositories:
8.1 ISD should be disseminated through websites of the Recognised Stock Exchanges (where the entity is listed / is proposed to be listed) and the Depositories.
8.2 All entities involved in the process are advised to take necessary steps to ensure compliance in this regard.
9. Implementation in phases:
9.1 In the first phase, the roll-out took place of ISD for public issues of specified securities, for offer documents filed on or after March 01, 2023.
9.2 In the second phase, ISD for further issues was implemented from April 03, 2023.
9.3 In the third phase, ISD for open offer, buy-back and voluntary delisting shall be implemented from May 02, 2023.
10. Further, Lead Managers are required to disseminate all advertisements in connection with a public issue under ICDR Regulations 2018 in pdf format on the website of the stock exchange(s) from March 01, 2023.
11 . The recognized Stock Exchanges and the Depositories are directed to:
11.1 bring the provisions of this chapter to the notice of all registered merchant bankers, listed entities and issuers and also disseminate the same on their websites; and
11.2 communicate to SEBI, the status of implementation of the provisions of this chapter within 7 days of implementation and in their Monthly Developments Reports.
Annexure I
Procedures on the Rights Issue process
A. Application Form
a) The issuer shall dispatch a common application form to its shareholders as on the record date. Along with application form, the issuer shall also send the details of the rights entitlements of the shareholder separately.
b) This application form can be used both by shareholder or renouncee.
c) Registrar to the issue shall also upload the application forms on its
d) Applicants can use application form available on the website of registrar to the issue or printed forms sourced from the issuer, merchant bankers or registrars to the issue.
e) In terms of Regulation 78 of the ICDR Regulations 2018, investor also has option to make an application in writing on a plain paper.
B. Credit of Rights Entitlements (“REs”) in dematerialized form
a) The depositories shall put necessary procedures in place for issue and credit of REs in demat mode.
b) The issuer making a rights issue of specified securities shall ensure that it has made necessary arrangements with depositories to issue and credit the REs in demat mode in the demat accounts of shareholders holding shares as on the record date.
c) A separate ISIN shall be obtained by the issuer for credit of REs.
d) Issuer shall specify the ISIN for REs while announcing the record date.
e) Based on the rights entitlement ratio, the issuer shall credit REs in dematerialized mode through corporate action to shareholders holding shares as on record date. The ISIN of REs shall be kept frozen (for debit) in the depository system till the date of opening of the issue.
f) Physical shareholders shall be required to provide their demat account details to Issuer / Registrar to the Issue for credit of REs not later than two working days prior to issue closing date, such that credit of REs in their demat account takes place at least one day before issue closing date.
g) In case of fractional entitlements of REs, the fractional part shall be ignored by rounding down the entitlement.
h) The issuer shall submit details of total REs credited to the stock exchanges immediately after completing the corporate action for the same and shall obtain requisite trading approval from the stock
i) The details with respect to shareholder entitlement shall be made available on the website of the Registrar to the issue and the investors shall be able to check their respective entitlements on the website of the Registrar by keying their details, after adequate security controls to ensure that investors’ information is made available only to the particular investor. Issuer shall also carry these links on their website.
j) If the demat account of a shareholder is frozen or demat account details are not available, including shares held in unclaimed suspense account or in the account of IEPF Authority, then REs shall be credited in a suspense escrow demat account of the Company and an intimation should be sent to such shareholder by the issuer /Registrar to the issue.
k) The issuer shall intimate issue closing date to the depositories at least one day before the issue closing date, and the depositories shall suspend the ISIN of REs for transfers, from issue closing date.
l) REs which are neither renounced nor subscribed by the shareholders, shall be lapsed after closure of the Rights Issue.
m) Issuer Company shall ensure that REs which are lapsed are extinguished from the depository system once securities are allotted pursuant to Rights Issue. Once allotment is done, the ISIN for REs shall be permanently deactivated in the depository system by the
C. Renunciation process and trading of REs on stock exchange platform:
a) The stock exchanges shall put necessary procedures in place for trading of REs on stock exchange platform.
b) REs credited to demat account can be renounced either by sale of REs using stock exchanges platform or off-market transfer and such trades will be settled by transferring dematerialized REs through depository mechanism in the same manner as done for all other types of securities.
c) For sale of REs through stock exchange, investors can place order for sale of REs only to the extent of REs available in the demat account of the investor. Trading in REs on the secondary market platform of Stock exchanges will happen electronically on T+1 rolling settlement basis where T being the date of trading. The transactions will be settled on trade-for-trade basis.
d) Issuer shall inform the dates of issue opening and closing to the stock exchanges and the depositories at the time of filing the letter of offer with the stock exchanges.
e) Trading in REs shall commence on the date of opening of the issue and shall be closed at least three working days prior to the closure of rights
D. Submission of Application form in Rights Issue
a) All investors (including renouncee) shall submit application forms using ASBA facility through the Self Certified Syndicate Banks (SCSB) network during the issue period.
b) Investor shall submit only one application form for REs available in a particular demat account.
E. Allotment process in the rights issue
a) Facility for correction of bid data as collated by the SCSB after issue closing shall be provided for period of one day i.e. on next working day after issue closing.
b) Registrar shall obtain demographic details of all applicants from
c) Registrar shall obtain details of holders of REs as on issue closing date, from the depositories.
d) After reconciliation of valid ASBA applications, funds blocked and REs demat holding list, the registrar shall finalise allocation of securities offered through rights offering.
e) Registrar shall credit the shares to the respective demat accounts of the applicants based on basis of allotment approved by the designated stock exchange and shall issue instructions to unblock bank accounts wherever necessary.
Annexure II
This is an abridged prospectus containing salient features of the Red Herring Prospectus (the “RHP”). You are encouraged to read greater details available in the RHP (Link to download RHP) .
THIS ABRIDGED PROSPECTUS CONSISTS ‘XY ’ PAGES. PLEASE ENSURE THAT YOU HAVE RECEIVED ALL THE PAGES.
NAME OF THE ISSUER COMPANY
CIN: XXXXX , Date of Incorporation: XXX
| Registered Office | Corporate Office | Contact Person | Email and | Websi |
NAMES OF PROMOTER(S) OF THE COMPANY
Details of Offer to Public
| Type of Issue (Fresh/ OFS/ Fresh &
OFS) |
Fresh Issue Size (by no. of shares or by amount in Rs) |
OFS Size (by no.of shares or by amount inRs) |
Total Issue Size (by no. of shares or by amount in Rs) |
Issue Under6(1)/ 6(2) |
Share Reservation | ||
| QIB | NII | RII | |||||
These equity shares are proposed to be listed on (to be specified) (designated stock exchange) and (to be specified). OFS: Offer for Sale
Details of OFS by Promoter(s)/ Promoter Group/ Other Selling Shareholders (upto a maximum of 10 selling shareholders
| Name | Type | No of Shares offered/ Amount in Rs |
WACA in Rs per Equity |
Name | Type | No of Shares offered/ Amount in Rs | WACA in Rs per Equity |
P: Promoter; PG: Promoter Group; OSS: Other Selling shareholder; WACA: Weighted Average Cost of Acquisition shall be calculated on fully diluted basis
Price Band, Minimum Bid Lot & Indicative Timelines
| Price Band* | Rs Xx To Rs Xx Per Equity Share of Face Value of Rs X |
| Minimum Bid Lot Size | XX ach Equity Shares |
| Bid/Offer Open On | |
| Bid/Closes Open On | |
| Finalisation of Basis of Allotment | |
| Initiation of Refunds | |
| Credit of Equity Shares to Demat accounts of Allottees | |
| Commencement of trading of Equity Shares |
*For details of price band and basis of offer price, please refer to price band advertisement and page xx of RHP.
Details of WACA of all shares transacted over the trailing eighteen months from the date of RHP
| Period | Weighted Average Cost of Acquisition (in Rs.) | Upper End of the Price Band is ‘X’ times the WACA | Range of acquisition price Lowest Price- Highest Price (in Rs.) |
| Trailing Eighteen Month from the date of RHP |
WACA: Weighted Average Cost of Acquisition shall be calculated on fully diluted basis for the trailing eighteen months from the date of RHP.
RISKS IN RELATION TO THE FIRST OFFER
The face value of the Equity Shares is ` x. The Floor Price, Cap Price and Offer Price determined by our Company and the Selling Shareholders, in consultation with the BRLM’s, on the basis of the assessment of market demand for the Equity Shares by way of the Book Building Process, as stated under “Basis for Offer Price” on page xx should not be considered to be indicative of the market price of the Equity Shares after listing. No assurance can be given regarding frequency of trading in the Equity Shares nor regarding the price at which the Equity Shares will be traded after listing.
GENERAL RISKS
Investment in equity & equity-related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of the Issuer and this Issue, including the risks involved. The Equity Shares have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”), nor does, SEBI guarantee the accuracy or adequacy of the contents of the RHP. Specified attention of the investors is invited to the section titled “Risk Factors” at page XXX of the RHP and on page XX of this
Abridged Prospectus.
PROCEDURE
You may obtain a physical copy of the Bid -cum-Application Form and the RHP from the stock exchange, syndicate members, registrar to the issue, share transfer agents, depository participant s, stock brokers, underwriters, bankers to the issue, investors’ associations or Self Certified Syndicate Banks.
If you wish to know about processes and pr ocedures applicable to this issue, you may request for a copy of the RHP and/or the General Information Document (GID) from the BRLM’s or download it from the websites of the Stock Exchanges i.e. www.nseindia.com; www.bseindia.com; and the BRLMs (websites to be specified).
| PR ICE IN F ORM AT ION O F B R L M ’s* | ||||
| Issue Name | Name of Merchan t Banker |
+/- % change in closing price, (+/- % change in closing benchmark) – 30th calendar days from listing | +/- % change in closing price, (+/- % change in closing benchmark) – 90th calendar days from listing |
+/- % change in closing price, (+/% change in closing benchmark) – 180th calendar days from listing |
| +1% (+5%) | -2% (-5%) | |||
* Disclosures subject to recent 7 issues (initial public offerings) in current financial year and two preceding financial years managed by each Merchant Banker with common issues disclosed once.
| Name of BRLM and contact details (telephone and email id) of each BRLM | |
| Name of Syndicate Member s |
In case of issues by Small and Medium Enterprises under Chapter IX, details of the market maker to be included
| Name of Registrar to the Issue and contact details (telephone and email id) | |
| Name of Statutory Auditor | |
| Name of Credit Rating Agency and the rating or grading obtained, if any | |
| Name of Debenture trustee, if any. | |
| Self-Certified Syndicate Banks | The list of banks is available on
https://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/Intermediaries |
| Non-Syndicate Registered Brokers |
You can submit Bid cum Application Forms in the Issue to Non Syndicate Registered Brokers at the Non Syndicate Broker Centres For further details, see section titled “Issue Procedure” beginning at page XX of the RHP |
| Details regarding website address(es)/ link(s) from which the investor can obtain list of registrar to issue and share transfer agents, depository participants and stock brokers who can accept application from investor (as applicable) |
–
| PROMOTERS OF THE ISSUER | COMPANY | ||
| Sr. No. | Name | Individual/Corporate | Experience & Educational Qualification |
| Experience:
Educational Qualification: |
Details of promoter/s should not exceed 500 words while explaining their experience and educational qualifications
| BUSINESS OVERVIEW AND STRATEGY |
| Company Overview: |
| Product/Service Offering:
Revenue segmentation by product /service offering |
| Geographies Served:
Revenue segmentation by geographies |
| Key Performance Indicators: |
| Client Profile or Industries Served:
Revenue segmentation in terms of top 5/10 clients or Industries: |
| Intellectual Property, if any : |
| Market Share: |
| Manufacturing plant, if any: |
| Employee Strength: |
Note: (1) The quantitative statements shall be substantiated with Key Performance Indicators (KPIs) and other quantitative factors.
(2) No qualitative statements shall be made which cannot be substantiated with KPIs. (3) Information provided in the table should not exceed 1000 words.
| BOARD OF DIRECTORS | ||||
| Sr. No. |
Name | Designation (Independent/ Whole time/Executive / Nominee) | Experience & Educational Qualification |
Other Directorships |
| 1 | Indian Companies: Foreign Companies: | |||
| 2 | ||||
| 3 | ||||
| 4 | ||||
| 5 | ||||
OBJECTS OF THE ISSUE
Details of means of finance
The find requirements for each of the objects of the Issue are stated as follows: (Rs. in crores)
| Sr. No. | Objects of the Issue | Total estimate cost |
Amount deploye d till |
Amount to be financed from Net Proceeds | Estimated Net Utilization Fiscal 20_ | Proceeds Fiscal 20_ |
| 1 | ||||||
| 2 | ||||||
| 3 | ||||||
| 4 | ||||||
| 5 | General corporate purposes | |||||
| Total |
Details and reasons for non -deployment or delay in deployment of proceeds or changes in utilization of issue proceeds of past public issues / rights issue, if any, of the Company in the preceding 10 years.
Name of monitoring agency, if any
Terms of Issuance of Convertible Security, if any
| Convertible securities being offered by the Company | |
| Face Value / Issue Price per Convertible securities | |
| Issue Size | |
| Interest on Convertible Securities | |
| Conversion Period of Convertible Securities | |
| Conversion Price for Convertible Securities | |
| Conversion Date for Convertible Securities | |
| Details of Security created for CCD |
Shareholding Pattern:
| Sr. No. | Particulars | Pre Issue number of shares | % Holding of Pre issue |
| 1. | Promoter and Promoter Group | ||
| 2. | Public | ||
| Total | 100.00% |
Number/amount of equity shares proposed to be sold by selling shareholders, if any.
RESTATED CONSOLIDATED AUDITED FINANCIALS
| Latest Stub period |
FY 3
(Last audited financial year prior to issue opening) |
FY 2 | FY 1 | |
| Total income from operations (Net) | ||||
| Net Profit/(Loss) before tax and extraordinary items | ||||
| Net Profit / (Loss) after tax and extraordinary items | ||||
| Equity Share Capital | ||||
| Reserves and Surplus | ||||
| Net worth | ||||
| Basic earnings per share (Rs.) | ||||
| Diluted earnings per share (Rs.) | ||||
| Return on net worth (%) | ||||
| Net asset value per share (Rs.) |
INTERNAL RISK FACTORS
Minimum 5 and maximum 10 risk factors to be specified)
The below mentioned risks are top 5 or 10 risk factors as per the RHP. (500-word limit in total)
SUMMARY OF OUTSTANDING LITIGATIONS, CLAIMS AND REGULATORY ACTION
A. Total number of outstanding litigations against the company and amount involved
| Name of Entity | Criminal Proce edings | Tax Proce edings | Statutory or Regulatory Proce edings | Disci plinary actions by the SEBI or Stock Exch anges against | Material Civil Litigations | Aggre gate amount involve d (Rs in crores) |
| Company | ||||||
| By the Company | ||||||
| Against the Company | ||||||
| Directors | ||||||
| By our Directors | ||||||
| Against the Directors | ||||||
| Promoters | ||||||
| By Promoters | ||||||
| Against Promoters | ||||||
| Subsidiaries | ||||||
| By Subsidiaries | ||||||
| Against Subsidiaries |
B. Brief details of top 5 material outstanding litigations against the company and amount involved
| Sr. No.
|
Particulars | Litigation filed by | Current status | Amount involved |
C. Regulatory Action, if any – disciplinary action taken by SEBI or stock exchanges against the Promoters in last 5 financial years including outstanding action, if any (200 – 300-word limit in total)
D. Brief details of outstanding criminal proceedings against Promoters (200 – 300-word limit in total)
ANY OTHER IMPORTANT INFORMATION AS PER BRLM / ISSUER COMPANY
DECLARATION BY THE COMPANY
We hereby declare that all relevant provisions of the Companies Act, 1956, the Companies Act, 2013 and the guidelines/regulations issued by the Government of India or the guidelines/regulations issued by the Securities and Exchange Board of India , established under Section 3 of the Securities and Exchange Board of India Act, 1992, as the case may he have been complied with and no statement made in the Red Herring Prospectus is contrary to the provisions of the Companies Act, 1956, the Companies Act, 2013, the Securities and Exchange Board of India Act, 1992 or rules made or guidelines or regulation issued there under, as the case may be. We further certify that all statements in the Red Herring Prospectus are true and correct.
Note:-
1 SEBI/HO/CFD/DIL2/CIR/P/2019/94 August 19, 2019 and SEBI/HO/CFD/DIL1/P/CIR/2021/0660 November 23, 2021
2 SEBI/HO/CFD/DIL2/CIR/P/2020/13 January 22, 2020 and SEBI/HO/CFD/SSEP/CIR/P/2022/66 May 19, 2022
3 SEBI/HO/CFD/SSEP/CIR/P/2022/14 February 04, 2022
4 SEBI/HO/CFD/DIL1/CIR/P/201 8/011 January 19, 2018
5 SEBI/HO/CFD/DIL2/CIR/P/201 8/22 February 15, 2018
6 SEBI/HO/CFD/DIL/CIR/P/2021/614 Aug 13, 2021.
7 SEBI/HO/CFD/DIL2/CIR/P/201 9/67 May 22, 2019
