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ICDR REGULATIONS
11 Sept, 2018
1. Anchor Investors
- Qualified Institutional Buyer
- This is not an individual
- Value of appl at least 10cr (min investment)
- For anchor investors the subscription opens one day before
- If high level investors invest in the securities one day prior
2. Institutional Investor
- QIB
- Net worth >500cr as per latest audited balance sheets
- Not an individual (QIB, family trusts)
- Institutional Trading Platform: platform for start ups. They can list and try to raise
money. Only have to lock in for 6 months not 1 year like a normal IPU. Less disclosure
requirements as well
3. Non-institutional investors
-
4. Retail inst investor are those investors who have invested not more than 2 lakh in the
specified security
- lot of safety net arrangements made to protect these retail institutional investors
7.10.19
2. Rights Issue
- Pre emptive rights of existing shareholders
- If any further share has to be offered, wants more money doesn’t want to compromise w
the shareholding, any further issue will be offered to the shareholders first
3. Private Placement
- When you issue securities to more than 200 persons in a financial year it becomes a pvt
placement
a. Pvt Placement (Unlisted Co)
- no drafting of prospectus and draft an offer letter
- Pvt co doing pvt placement
[Sometimes, in the terms of issue of debenture, it might state that on default, the debenture may
be converted into an equity share.]
III. PUBLIC ISSUE OF SHARES
6(1)a
- Net tangible assets of at least 3 cr rupees calculated on restated and consolidated basis
- In each of the preceding three full yearsof 12 months each
- Of which not more than 50% are held in monetary assets
Proviso
- If more than 50% of NTA held in monetary asset (MA)
- Issuer has utilised or made firm commitments to utilise excess MA in its business or
project
- Further provided that this 50% thing ill not be applicable in case IPO is made entirely
through an offer for sale
Net tangible asset is tangible asset subtracted from the liability of the co [100 tangible
asset and 50 liability]
Suppose there is value Rs 20 goodwill and IPR (these are intangible assets). Subtract this
too. So now NTA is 30
NTA = A – (L +ITA)
Restatement: in financial terms, it means an inaccuracy that has been corrected (suppose
calculation of depn was wrong in previous year and corrected this year)
Consolidated means taking into consideration all your subsidies as well
2017, 16 and 15 if it is issued in 2018
The assets cannot be in liquid form. So that there can be inappropriate use of it. Cannot
easily sell as not liquid, so the chance of manipulation isn’t less.
Do not rely on an issuer’s worth that is relying on liquid cash
Proviso:
Do not utilise the liquid cash for any other activity or project than for which you are
investing in