Scribd
Upload
51 views1 page

NRI Issue Management Procedures in India

The document discusses guidelines for lead merchant bankers regarding issue management, research reports, and book building. It states that book building is a process by which demand and pricing for securities proposed to be issued by a company are determined in order to set the quantity to be issued. It allows companies to reserve up to 75% of shares for allocation through a book building process subject to requirements like indicating this in the prospectus, reserving a minimum 25% for public offer, and fully underwriting the public portion. Research reports distributed by issuers must be based solely on offer document information and cannot provide additional selective details to certain investors.

Uploaded by

Rag Lak
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
51 views1 page

NRI Issue Management Procedures in India

The document discusses guidelines for lead merchant bankers regarding issue management, research reports, and book building. It states that book building is a process by which demand and pricing for securities proposed to be issued by a company are determined in order to set the quantity to be issued. It allows companies to reserve up to 75% of shares for allocation through a book building process subject to requirements like indicating this in the prospectus, reserving a minimum 25% for public offer, and fully underwriting the public portion. Research reports distributed by issuers must be based solely on offer document information and cannot provide additional selective details to certain investors.

Uploaded by

Rag Lak
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Issue Management: Activities/Proceclures

14.25

indicate the place in India from where the individual NRI applicant can procure applications
forms. The lead merchant banker should also comply with the following:
Obtain an undertaking from the issuer as part of the Memorandum of Understanding to be
entered into by the lead merchant banker with the issuer company to the effect that the issuer
company would not directly release, during any conference or at any other time, any material or
information that is not contained in the offer document;
Ensure that the issuer company obtains approval in respect of all issue advertisements and
publicity materials from the lead merchant banker responsible for marketing the issue, also
ensure availability of copies of all issue related materials with him, at least till the allotment is
completed.

Research Reports
The lead merchant banker should ensure that the following are complied with in respect of research
reports:
It is prepared only on the basis of published information, as contained in the offer document.
No selective/additional information/information extraneous to the offer document should be
made available by the issuer/any member of the issue management team/syndicate to only one
section of the investors or to any research analyst in any manner whatsoever including at road
shows, presentations, in research/sales reports, at bidding centres and so on.
No research report should be circulated by the issuer/any member of the issue management
team/syndicate or their associates commencing from a date 45 days immediately preceding the
filing of the offer document with the SEBL
The advertisement code is observed while circulating the research report(s) and the risk factors
are reproduced wherever highlights are given, as in the case of an advertisement.

BOOK-BUILDING
Book-building means a process by which a demand for the securities proposed to
be issued by a body corporate is elicited and built up and the price for such
securities is assessed for the determination of the quantum of such securities to be
issued by means of a notice/circular/advertisement/document or information
memoranda or offer document. A company proposing to issue capital through
book-building has to comply with the requirements detailed below.

Book-building
means a process by
which a demand for
the securities
proposed to be
issued by a body
corporate is elicited
and built up and the
price for such
securities is
assessed.

75 Per cent Book-Building Process


In an issue of securities to the public through a prospectus, the option for 75 per cent book-building
is available subject to the following:
The option of book building is available to all body corporates that are otherwise eligible to make
an issue of capital to the public as an alternative to, and to the extent of, the percentage of the issue,
which can be reserved for firm allotment. The issuer company can either reserve the securities for
firm allotment or issue them through the book-building process. The issue of securities through the
book-building process should be separately identified/indicated as placement portion category, in
the prospectus. The securities available to the public should be separately identified as net offer to
the public. The requirement of minimum 25 per cent of the securities to be offered to the public is
also applicable. Underwriting is mandatory to the extent of the net offer to the public. The draft
prospectus containing all the information, except the information regarding the price at w^hich the

You might also like