pubic+issue+by
TRANSCRIPT
PUBIC ISSUE BY LISTED COMPANIES
MADE BYDISHA DHAR
RUBEENA CHIB SAVITA AGARWAL
VIKAS DIWAN
3 WAYS OF RAISING FUNDS
By issuing a prospectus
This is method by which a company seeks to raise capital from public. It invites offer from members of the public to subscribe for its shares and debentures through the prospectus.
By an offer for sale or by deemed prospectus Issuing house publishes a document called an
offer for sale within application from attached offering to the public share or debenture for sale at a price higher than what they had paid
By placing of shares A private ltd company is probhited by the
act and the article from inviting the public for subscription of shares or debentures.
A public company can also raise capital by private placement
Thereby a broker or underwriter find person normally the clients who wish to buys the shares
PUBLIC ISSUE OF SHARES It means selling or marketing of
shares for subscription by the public by issue of prospectus.
The company raise capital from public by issue of shares
Management of public issue involves coordination of activites and cooperation of a number of agencies such as managers to issue underwriters brokers.
Process of issuing of shares divided into
Pre issue-All activities beginning with planning of capital issue till opening of subscription
Post issue- all activities subsequent to opening of subscription list.
Public issue of securities can be made by
Prospectus and issuing of securities in physical form which shall not be listed on any stock exchange.
By prospectus and issuance of securities in dematerialized format.
SEBI Guidelines for issue of equity shares
A company cannot issue securities If it has been prohibited from accessing
capital market by order or direction of SEBI Unless it has made application for listing
of those in stock exchange. A company should enter into a
agreement with depository for dematerializations' of securities already issued or proposed to be issued to the public
Preferntial issue by listed companies
o All preferential issue should comply with requirement with SEBI guidelines
o The offer price should not be less than the higher of average of weekly high and low of closing price of related shares
Fcd/ Pcd/ hares issued on preferential basis are subject to lock in period of 3 years
They can be transferred within the promoters of the company.
Issue of shares /securities of a premium
The company may issue securities at a premium when it is able to sell them at a price above par or above nominal value
The securities whether received in cash or in kind must be kept in account known as “ security premium account”.
In accordance with the provison of section 78(2)
Issuing fully bonus shares to members
Writing off the balance of preliminary expense of the company.
Writing of commission paid or discount allowed
For providing the premium payable on redemption.