listing of securities in Indian Stock Market Nse and Bse

1. PRESTIGE INSTITUTE OF
MANAGEMENT AND REASEARCH
SUBMITTED TO
PROF. SARFARAJ ANSARI
“ Listing of Securities”
SUBMITTED BY:
AYUSH YADAV

2. CONTENTS
 Introduction of listing
 Merits and demerits of listing.
 Qualification of listing.
 Listing procedure.
1. pre listing procedure
2. post listing procedure

3. LISTING OF SECURITIES

4. INTRODUCTION
 Listing refers to the admission of security of a public
limited company on a recognized stock exchange for
trading.
 A company, desirous of listing its securities on the
Exchange , shall be required to file an application in a
prescribed form to the exchange before issuing
“prospectus” or “offer for sale” by the company.
 The company shall be responsible to fallow all the
requirement specified in the Companies Act and the
listing norms issued by SEBI.

5. MERITS AND DEMERITS OF LISTING
 Merits :-
1. Liquidity.
2. Timely Disclosure of Corporate Information.
3. Ability to raise further capital.
4. Fair Price for the Securities.
 Demerits :-
1. Control.
2. Discloser.
3. Cost

6. MERITS OF LISTING
 Liquidity :-Listing provides an opportunity to the
corporate / entrepreneurs to raise capital to fund new
projects/undertake expansions/diversifications and for
acquisitions. Listing also provides an exit route to private
equity investors.
 Timely Disclosure of Corporate Information:-The
listing agreement signed with the exchange provides for
timely disclosure of information relating to dividend,
bonus and right issues, book closure, facilities for transfer,
company related information by the company. Thus
providing more transparency and building investor
confidence.

7. Merits of listing
 Ability to raise further capital:-An initial listing
increases a company's ability to raise further capital
through various routes like preferential issue, rights
issue etc.
 Fair Price for the Securities:-The prices are publicly
arrived at on the basis of demand and supply; the
stock exchange quotations are generally reflective of
the real value of the security. Thus listing helps
generate an independent valuation of the company by
the market.

8. DEMERITS OF LISTING
 Control - An IPO automatically implies a change in
the structure of ownership. A private business owner
may have complete control over a business but as soon
as it becomes a public company, other organisations
and individuals have the right to express an interest
and in some cases, to direct decision making.

9. DEMERITS OF LISTING
 Disclosure - A public company has an obligation to inform
the public, through the authorities, of what's going on
although this doesn't always work as well in practice as it
does in theory. Any developments that may affect the share
price must be disclosed.
 Cost - Listing a company isn't cheap either. There's the
extra cost of disclosure, the annual and other reports to
shareholders, not to mention the costs involved with
listing. These additional expenses need to be carefully
considered when analysing a prospectus as they can
consume a substantial portion of the amount being raised.

10. QUALIFICATION FOR LISTING
 Minimum issued capital :- 10 corers.
 Payment of excess application money:- 15% after 30
days.
 Listing on the multiple stock exchanges:- paid up
capital 5 corers, compulsory listing on more than one
exchange.
 Requirement of 1% securities to the designated stock
exchange.
 Payment of listing fees.

11. PRE LISTING PROCEDURE
 File DRHP with SEBI and SE
 Obtain SEBI Observations (within 30 days)
 Carry out the changes in the DRHP
 Obtain No-Objection from SEBI (generally 2-5 days)
 Decide Price Band
 File RHP with ROC and also with SEBI for info.
 Obtain ROC Approval with / without changes (generally 1-3
days)
 Decide Issue Opening and Closing Date (minimum 3 days
as per ICDR)
 Give Go-ahead to Printers and Mailers Advertisements /
Publicity ….cont.

12. PRE LISTING PROCEDURE
 Issue Opens, Closes.
 Obtain Provisional Certificates from bankers to the Issue
(generally 2 working days).
 Obtain Final Certificate from bankers to the Issue
(generally 3 working days)
 Run rejections with Registrar to the Issue, in presence of
MB (1 day)
 Prepare Basis of Allotment (1 day)
 File Basis of Allotment with DSE (Designated Stock
Exchange) Obtain Approval (1-3 days)
 Intimate NSDL & CDSL for credit of Shares

13. PRE LISTING PROCEDURE
 Simultaneously do the Refunds Obtain
 Credit Certificate from NSDL & CDSL
 File Listing Application Obtain Listing and Trading
Permission.
 The necessary formalities for listing and
commencement of trading at all stock exchanges
where the securities are to be listed are taken within
seven working days of finalisation of basis of
allotment;

14. POST LISTING PROCEDURE
 Upon obtaining Listing and Trading Approvals, the
merchant banker confirms to the Bankers to the Issue
by way of copies of listing and trading approvals that
all formalities in connection with the issue have been
completed and that the banker is free to release the
money to the issuer.

15. LISTING APPLICATION
 Listing Application
 Listing Application
 Form Listing Agreement
 Annexure
 Listing Fee
 Security Deposit under Cl. 42 of LA

16. ANNEXURE REQUIRED
 Basis of Allotment
 Advt. Copies
 Shareholding patterns
 List of Top Shareholders
 Material Contracts and Documents
 PCS/CA Certificates

17. ON THE DAY OF SUBMISSION OF
LISTING APPLICATION
 Be on TIME
 Try to be calm
 Be prepared with the numbers
 KNOW What you file
 Be honest
 Don’t try to outsmart them

18. TILL LISTING IS DONE
 Till the commencement of listing and trading of the
specified securities offered through the Issue, all the
material development in respect of the issuer shall be
informed through public notices/ advertisements in all
those newspapers in which pre-issue advertisement
and advertisement for opening or closure of the issue
have been given.

19. FAILURE TO GET LISTING APPROVAL
 The issuer shall refund the moneys raised in the issue
to the applicants, in case of failing to get listing
permission. The issuer shall pay requisite interest
amount if so required under the laws or direction or
order of the Board.

20. Q & A

21. Thank you….