This document provides information about listing of securities on stock exchanges in India. It defines listing as admission of securities like shares of public companies to trading on a recognized stock exchange. For an initial public offering, companies must meet regulatory requirements and pay listing fees to the exchange. The Securities and Exchange Board of India (SEBI) regulates stock exchanges and intermediaries involved in the listing and trading of securities. The document outlines the listing process and requirements, types of investors, allotment procedures, and importance of listing securities on a stock exchange.

1. LISTING OF SECURITIES
PRESENTED BY:
Pawan Singh Raikhola
MBA INT. 5th SEM
(1664880012)

2. MEANING…..
Listing means admission of securities to
dealings on a recognized stock
exchange.The securities may be of
any public limited company, central or
state government, quasi
governmental and other financial
institutions/corporations,
municipalities, etc.

3. LISTING OF SECURITIES
 A financial instrument that is traded
through an exchange, such as the NSE,
BSE or MCX.When a private company
decides to go public and issue shares, it
will need to choose an exchange on which
to be listed.
 Exchange’s listing requirements and pay
both the exchange’s entry and yearly
listing fees.

4. REGULATRY FRAMEWORK
 SEBI is referred as the market watchdog. It is so
to regulating the business of stock exchange,
registering stock brokers, sub broker, share
transfer agents, trustees of trust, merchant
bankers, underwriters, bankers to an issue,
portfolio manager and all such intermediary who
may be associated with the securities market in
any form.
 SEBI further registers and regulates depository
participants, venture capital firms, custodian of
securities, FII, mutual funds.

5. BASIC ENTRY NORMS FOR PUBLIC
ISSUE….
 New tangible assets of at least Rs.3crore for 3 full
years.
 Distribution profits in at least 3 year out of 5
preceding year.
 Net worth of at least Rs.1crore in 3 year.
 If change in the name of the company at least
50% of revenue for preceding 1 year should be
form the newly renamed company activities.
 The issue size does not exceed 5 times the pre
issue net worth.

6. LIST OF IMPORTANT INTERMEDIARY
REGULATED BY SEBI
 Merchant Bankers
 Underwriters
 Syndicate member
 Custodian of securities
 Credit rating

7. IMPORTANCE ASPECT OF LISTING
SECURITIES
 Offer Document / Red Herring Prospectus
This is mandatory document that a company
which is proposing a public issue has to
prepare and submit it to SEBI for approval.
If SEBI approves the document then only
offer document made available for IPO.
Unless this document is not fully approved by
SEBI a company cannot conduct their public
issue.

8. TYPES OF LISTING OF SECURITIES
1. Initial listing: Here, the shares of the company are
listed for the first time on a stock exchange.
2. Listing for public issue: When a company which
has listed its shares on a stock exchange comes out
with a public issue.
3. Listing for right issue:When the company which
has already listed its shares in the stock exchange
issues securities to the existing shareholders on
right basis.
4. Listing of bonus shares:When a listed company in
a stock exchange is capitalizing its profit by issuing
bonus shares to the existing shareholders.

9. CATEGORY OF INVESTORS…..
1) Retail Individual Bidders (RIB):
o Resident Indian Individuals, NRIs and HUFs who apply for
less than Rs 2lakhs in an IPO falls under RIB.
o Not less than 35% of the officer is reserved for RIB.
2) Non-Institutional Bidders (NIB):
o Resident Indian individuals, eligible NRIs, HUFs,
companies, corporate bodies, scientific institutions,
societies and trusts who apply for more than Rs 2lakhs of
IPO shares.
o NIB need not to register with SEBI.
o Not less than 15% of the offer is reserved for NIB.

10. CONTD……
3) Qualified Institutional Bidders (QIB):
o Public financial institutions, commercial
banks, mutual funds and foreign portfolio
investors etc. can apply in QIB category.
o 50% of the offer size is reserved for QIB’s.
o Allotment basis- proportionate.

11. ALLOTMENT PROCEDURES……
 Oversubscription:
 We know that the listing time for an IPO in India is
around 7 working days.
 During this period when the allotment is completed,
other statutory fillings are done and the stock gets listed.
 Under Subscription:
 It can be due to high pricing that leaves not much for
investors.
 High valuation demand.
 High debt/equity content, risk associated in the business.
 Lack of promotion or lack of awareness etc.

12. CONTD…..
 Fully subscribed: It is the position an initial
bond or stock offering finds itself in once all
shares of an offering have been purchased or
guaranteed by investors. An underwriting
company usually facilitates these initial
transactions on behalf of younger companies
that are making their initial public offering.

13. LISTING PROCEDURE
 Preliminary discussion: with stock exchange
 Articles of association approval: it has to fulfill
following requirements
i. Common form of transfer should be used.
ii. Once the shares are fully paid, they should be free
from all lien.
iii. The calls carried out in advance are entitled for
interest but not dividends.
iv. Free dealing should not be restricted by any
provision.
v. The company should comply with the section 205-A
of companies act in the case of dividends.

14. CONTD……
 Draft prospectus approval: getting approval of draft
prospectus is the essential pre-requisite for the
security to be listed. Before finalizing the draft
prospectus the company authorities should hold a
discussion with stock exchange authorities.The
prospectus should clearly state the following.
i. The name of regional stock exchange and any other
stock exchange where it intends to list securities.
ii. Date of opening of issue and closing.
iii. Open for minimum 3 working days and maximum
of 10 days.

15. CONTD……
 Listing application: any company when it intends
to offer shares to the public through prospectus,
should make an application to the stock
exchange where the share is to be listed. A no.
of certificates are to be submitted with
application and are as follows:
i. Three certified copies of MOA and debentures
trust deed.
ii. Copies of prospectus, offer for sale made during
last 5 years and circulars and advertisement
regarding offer made during last five years.

16. CONTD…..
iii. Copy of every letter, repot, balance sheet, valuation, contract,
court order or any other document given in the prospectus.
iv. Certified copies of underwriting, brokerage, vendors, promoter’s
selling agents and sales managers agreement.
v. Certified copies of the service agreement of secretaries, treasures,
managing director, technical directors, general manager and
manager.
vi. Particulars regarding the material contract, technical advice and
collaborations, concession and similar other documents.
vii. Copies of agreements with IFC, industrial credit and investment
corporation and such other bodies.
viii. Details regarding the re-organizations, reconstruction,
amalgamation and details of companies activities.

17. MERITS OF LISTING
 Liquidity
 Best price
 Regular information
 Periodic reports
 Transferability
 Income tax benefit
 Wide publicity

18. DEMERITS OF LISTING
 Listed companies are subjected to do various
regulatory measures of the stock exchange
and SEBI.
 Essential information has to be submitted by
the listed companies to stock exchange.
 Annual meeting and annual general report.
 Public offers is an expensive exercise.

19. DELISTING
It is the process of termination of permission
given to a listed company from trading its
securities on the stock exchange.
They can be in 2 ways:-
1) Compulsory Delisting
2) Voluntary Delisting

20. COMPULSORY DELISTING
It may in the following ways:-
a) Non-payment of listing fee or violation of
listing agreement.
b) Thin / negligible trading or thin
shareholding base.
c) Non-redressel of grivances.
d) Unfair trade practices at the behest of
promotes or managers, such as issuing of
duplicate or fake shares by the
management.

21. VOLUNTARY DELISTING
it may be in the following ways:-
a) Unable to pay listing fees.
b) Business is sick / closed / suspended.
c) Capital base is small.
d) Mergers, accquisitions, takeovers.

22. RELISTING
 Cooling period:-
• The company that has voluntarily delisted its
securities can relist its securities only after a
period of 5 years.
• The company that has been compulsory
delisted by the exchange can relist its
securities only after a period of 10 years.

23. CONTD……
Relisting of sick companies:-
• In case of delisted companies who were sick
in the past, can be given opportunity of listing
through restructuring scheme passed by
BIFR.
• The sick companies are exempted from the
provision of cooling period.

24. TRADING & SETTLEMENT
 Settlement of securities is a business process
whereby securities or interest in securities are
delivered, usually against payment of money, to
fulfill contractual obligations, such as those
arising under securities trades.
 Trade settlement is the process of transferring
securities into the account of a buyer and cash
into the seller’s account following a trade of
stocks, bonds, futures or other financial assets.

25. TRADE & SETTLEMENT DATES
The date an order is filled is the trade date,
whereas the security and cash are transferred on
the settlement date.The 3 day stock settlement
period is represented by
T+3=S
Which means the settlement date (S) is the trade
date (T) plus three business days.
The settlement period provides the time necessary
for clearing firms to ensure the orderly transfer
of shares and cash to the proper accounts.

26. CONTD…….
Trading on the derivatives segment takes place
on all days of the week (except Saturdays
and Sundays and holidays declared by the
Exchange in advance).The market timing of
the derivatives are:
Normal market/ exercise market open time:
09:15 hrs
Close time: 15:30 hrs

27. THANKYOU