Ipo Process
IPO Process
Stock offered to public
Approval by SEBI
Draft Offer document filed with SEBI
Negotiate the deal
Investment Bankers
(Underwriters)
Company SEBI Guidelines Regarding IPO 1. Eligibility Norms of the Issuer: The company shall meet the following requirements – * Net Tangible Assets≥ ` 3 crores (for 3 full years) * Should have track record of profitability in 3 out of previous years * Net worth ≥ ` 1 crore in three years * If change in name, atleast 50% revenue for preceding 1 year should be from the activity under new name 2. Size of the Public Issue: a. Issue of shares to public ≥ 25% of the total issue, b. The issue size should not be more that five times the pre-issue net worth 3. Promoter Contribution: c. Minimum Promoters contribution is 20-25% of the public issue. d. Minimum Lock in period for promoters contribution is 5 years 4. Prospectus: e. Abridged prospectus must be attached with every application form. f. Risk factors must be highlighted g. Objectives of the issue and the cost of the project should be disclosed h. Company’s management, past history and present business of the firm should be disclosed i. Particulars of the company and other listed companies under the same management who have made public issues during the past 3 years are to be disclosed
5. IPO Grading:
A company which has filed the draft offer document for its IPO with SEBI is required to obtain a grade from at least one CRA registered with SEBI like
- CARE
- ICRA
- CRISIL
- FITCH Ratings 6. Collection
Stock offered to public
Approval by SEBI
Draft Offer document filed with SEBI
Negotiate the deal
Investment Bankers
(Underwriters)
Company SEBI Guidelines Regarding IPO 1. Eligibility Norms of the Issuer: The company shall meet the following requirements – * Net Tangible Assets≥ ` 3 crores (for 3 full years) * Should have track record of profitability in 3 out of previous years * Net worth ≥ ` 1 crore in three years * If change in name, atleast 50% revenue for preceding 1 year should be from the activity under new name 2. Size of the Public Issue: a. Issue of shares to public ≥ 25% of the total issue, b. The issue size should not be more that five times the pre-issue net worth 3. Promoter Contribution: c. Minimum Promoters contribution is 20-25% of the public issue. d. Minimum Lock in period for promoters contribution is 5 years 4. Prospectus: e. Abridged prospectus must be attached with every application form. f. Risk factors must be highlighted g. Objectives of the issue and the cost of the project should be disclosed h. Company’s management, past history and present business of the firm should be disclosed i. Particulars of the company and other listed companies under the same management who have made public issues during the past 3 years are to be disclosed
5. IPO Grading:
A company which has filed the draft offer document for its IPO with SEBI is required to obtain a grade from at least one CRA registered with SEBI like
- CARE
- ICRA
- CRISIL
- FITCH Ratings 6. Collection