o Growth of the economy.
o Characterized by growing investor participation and
o Investor participation itself is influenced by the level of
protection that is guaranteed to an investor against
Retail category up to 35%
Entitled to privileges
Level of participation is still less
Uncertainty in terms of allotment, price
on listing and rate of return
Disclosure of information
1. Past market trends
2. Risk appetite
3. Rate of return
6. Taxation benefit
7. Frequency of return
8. Duration of investment
9. Investible surplus
10. Investment needs
• Crimes committed by intelligent but dubious
• Individuals can be both public or government
• Economic offences seriously affect national
Primary Market Frauds
Secondary Market Frauds
Bank and NBFCs Frauds
Import / Export Frauds
Violating Intellectual Property Laws
Smuggling of antiques, arts and treasures
Fake Stamps Scam
Adulteration in foodstuffs and drugs
Wildlife and environmental crimes
Fraudulent use of weights and measures
Making and selling of fake goods
Known as stock market launch.
Shares of stock in a company sold to the general
public for the first time.
Raising of capital for expansion.
To become publicly traded enterprises.
PLANNING FOR IPO PROCESS:
Planning for the IPO Process
Filing a Prospectus
Final Offering Price and Amount
Selling on the Stock Market
Enlarging and diversifying equity base
Enabling cheaper access to capital
Increasing exposure, prestige, and public image
Attracting and retaining better management and employees through
liquid equity participation
Facilitating acquisitions (potentially in return for shares of stock)
Creating multiple financing opportunities: equity, convertible debt,
cheaper bank loans,
Disadvantages of an IPO
There are several disadvantages to completing an initial public offering:
Significant legal, accounting and marketing costs, many of which are
Requirement to disclose financial and business information
Meaningful time, effort and attention required of senior management
Risk that required funding will not be raised
Public dissemination of information which may be useful to competitors,
suppliers and customers.
Loss of control and stronger agency problems due to new shareholders
1. Failed to file returns with Registrar of Companies (ROC) for a
period of 2years;
2. Failed to file returns with Stock Exchange (SE) for a period of 2
years (if it continues to be a listed company)
3. . It is not maintaining its registered office at the address notified
with the ROC /SE; and
4. None of its Directors are traceable.
5. Ministry of Corporate Affairs has clarified that all the
conditions mentioned above would have to be satisfied before a
listed company is declared as a vanishing company.
6. Further, the conditions mentioned at (1), (3) & (4) would
suffice to declare accompany as vanishing if such company has
been de-listed from the SE.