Listing on the Bombay Stock Exchange
Information on listing on the Bombay Stock Exchange: From http://www.bseindia.com/about/abintrobse/listsec.asp Listing means admission of securities to dealings on a recognised stock exchange. The securities may be of any public limited company, Central or State Government, quasi governmental and other financial institutions/corporations, municipalities, etc. The objectives of listing are mainly to : provide liquidity to securities; mobilize savings for economic development; protect interest of investors by ensuring full disclosures. The Bombay Stock Exchange (BSE) has a dedicated Listing Department to grant approval for listing of securities of companies in accordance with the provisions of the Securities Contracts (Regulation) Act, 1956, Securities Contracts (Regulation) Rules, 1957, Companies Act, 1956, Guidelines issued by SEBI and Rules, Bye-laws and Regulations of BSE. BSE has set various guidelines and forms that need to be adhered to and submitted by the companies. These guidelines will help companies to expedite the fulfillment of the various formalities and disclosure requirements that are required at various stages of Public Issues Initial Public Offering Further Public Offering Preferential Issues Indian Depository Receipts Amalgamation Qualified Institutions Placements Click here to Download Guidelines A company intending to have its securities listed on BSE has to comply with the listing requirements prescribed by it. Some of the requirements are as under : [I] Minimum Listing Requirements for New Companies The following eligibility criteria have been prescribed effective August 1, 2006 for listing of companies on BSE, through Initial Public Offerings (IPOs) & Follow-on Public Offerings (FPOs): Companies have been classified as large cap companies and small cap companies. A large cap company is a company with a minimum issue size of Rs. 10 crore and market capitalization of not less than Rs. 25 crore. A small cap company is a company other than a large cap company. In respect of Large Cap Companies The minimum post-issue paid-up capital of the applicant company (hereinafter referred to as “the Company”) shall be Rs. 3 crore; and The minimum issue size shall be Rs. 10 crore; and The minimum market capitalization of the Company shall be Rs. 25 crore (market capitalization shall be calculated by multiplying the post-issue paid-up number of equity shares with the issue price). In respect of Small Cap Companies The minimum post-issue paid-up capital of the Company shall be Rs. 3 crore; and The minimum issue size shall be Rs. 3 crore; and The minimum market capitalization of the Company shall be Rs. 5 crore (market capitalization shall be calculated by multiplying the post-issue paid-up number of equity shares with the issue price); and The minimum income/turnover of the Company shall be Rs. 3 crore in each of the preceding three 12-months period; and The minimum number of public shareholders after the issue shall be 1000. A due diligence study may be conducted by an independent team of Chartered Accountants or Merchant Bankers appointed by BSE, the cost of which will be borne by the company. The requirement of a due diligence study may be waived if a financial institution or a scheduled commercial bank has appraised the project in the preceding 12 months. For all companies : In respect of the requirement of paid-up capital and market capitalization, the issuers shall be required to include in the disclaimer clause forming a part of the offer document that in the event of the market capitalization (product of issue price and the post issue number of shares) requirement of BSE not being met, the securities of the issuer would not be listed on BSE. The applicant, promoters and/or group companies, shall not be in default in compliance of the listing agreement. The above eligibility criteria would be in addition to the conditions prescribed under SEBI (Disclosure and Investor Protection) Guidelines, 2000. [II] Minimum Listing Requirements for Companies already Listed on Other Stock Exchanges The listing norms for companies already listed on other stock exchanges and seeking listing at BSE, made effective from August 6, 2002, are as under: The company shall have a minimum issued and paid up equity capital of Rs. 3 crore. The company shall have a profit making track record for the preceding last three years. The revenues/profits arising out of extra ordinary items or income from any source of non-recurring nature shall be excluded while calculating the profit making track record. Minimum net worth shall be Rs. 20 crore (net worth includes equity capital and free reserves excluding revaluation reserves). Minimum market capitalisation of the listed capital shall be at least two times of the paid up capital. The company shall have a dividend paying track record for at least the last 3 consecutive years and the dividend should be at least 10% in each year. Minimum 25% of the company’s issued capital shall be with Non-Promoter shareholders as per Clause 35 of the Listing Agreement. Out of above Non-Promoter holding, no single shareholder shall hold more than 0.5% of the paid-up capital of the company individually or jointly with others except in case of Banks/Financial Institutions/Foreign Institutional Investors/Overseas Corporate Bodies and Non-Resident Indians. The company shall have at least two years listing record with any of the Regional Stock Exchanges. The company shall sign an agreement with CDSL and NSDL for demat trading. [III] Minimum Requirements for Companies Delisted by BSE seeking Relisting on BSETop Companies delisted by BSE and seeking relisting at BSE are required to make a fresh public offer and comply with the extant guidelines of SEBI and BSE regarding initial public offerings. [IV] Permission to Use the Name of BSE in an Issuer Company’s Prospectus Companies desiring to list their securities offered through a public issue are required to obtain prior permission of BSE to use the name of BSE in their prospectus or offer for sale documents before filing the same with the concerned office of the Registrar of Companies. BSE has a Listing Committee , comprising of market experts, which decides upon the matter of granting permission to companies to use the name of BSE in their prospectus/offer documents. This
The Bombay Stock Exchange Announces IPO Index
Bombay Stock Exchange, Asia’s oldest bourse, on Monday launched an initial public offering (IPO) index to track the value of stocks for two years after listing. The BSE said its IPO index will track companies which have a free-float market capitalisation of at least 1 billion rupees rupees ($21 million) on listing day. The index started on Monday has 48 stocks. It will have at least 10 stocks at any point of time, with the maximum weighting for a stock capped at 20 percent, it said. The base date of the index is May 3, 2004 and the base value was set at 1000 points, the BSE said. The launch of the index comes as new share offerings are making a comeback in India after a gap of 18 months, helped by a stock market rally. The benchmark 30 share index has gained nearly 60 percent so far this year. Power utilities Adani Power and NHPC Ltd have raised a combined $1.9 billion since late July in IPOs and Oil India is expected to launch a new share offering in September. The BSE, founded in 1875, is launching new products to regain market share from the National Stock Exchange, which handles almost twice the volume and is the world’s largest single stock futures market. (For more news on Reuters Money click in.reuters.com/money)