KREO CAPITAL PRIVATE LIMITED

NEWS LETTER – EIGHTH EDITION, 2019

KREO CAPITAL PRIVATE LIMITEDKREO CAPITAL NEWSLETTER - EIGHTH EDITION

DEAR ESTEEMED READERS,

WITH BEST REGARDS,

TEAM KREO CAPITAL

Monday, April 01, 2019

“An investment in knowledge yields the best return.”

In the ever changing and dynamic Capital Market Environment, staying

updated with the latest happenings is the need of the hour.

Keeping up to date with laws & notifications is time consuming and

legislation itself is complex. However, it is of vital importance that

businesses stay up to date on regulations in their sector to keep pace with

best practices.

This is our series of knowledge sharing initiative towards sharing

regulations and updates on corporate laws.

BODIES COVERED

KREO CAPITAL NEWSLETTER EDITION – JULY, 2018KREO CAPITAL NEWSLETTER - EIGHTH EDITION

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DPIIT STARTS ANALYSINGSTAKEHOLDERS' VIEWS ON DRAFT E-COMMERCE POLICYFor more details, please refer link :

//economictimes.indiatimes.com/articleshow/68631571.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

i-policy-in-ecommerce-may-be-deferred/ar8.cms

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BROAD ECONOMIC NEWS…

KREO CAPITAL NEWSLETTER - EIGHTH EDITION

LENS ON SHADY BANK DEALS INSHELL COMPANIESFor more details, please refer link :https://economictimes.indiatimes.com/news/economy/policy/lens-on-shady-bank-deals-in-shell-companies/articleshow/68641531.cms

BUYING FRENZY HEATS UP ON D-STREET; BUT BE CAREFUL WHEN ALLIS WELLFor more details, please refer link :https://economictimes.indiatimes.com/markets/stocks/news/buying-frenzy-heats-up-on-d-street-but-be-careful-when-all-is-well/articleshow/68641642.cms

HOMEGROWN MFs PIP FOREIGNFUNDS TO BAG TOP SLOTS IN INDIAFor more details, please refer link :https://economictimes.indiatimes.com/markets/stocks/news/homegrown-mfs-pip-foreign-funds-to-bag-top-slots-in-india/articleshow/68606953.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

FLOOD OF DOLLARS LEAVES CURRENCYMARKET IN A FLAPFor more details, please refer link :https://economictimes.indiatimes.com/markets/forex/flood-of-dollars-leaves-currency-market-in-a-flap/articleshow/68641147.cms

SMALL SAVINGS SCHEMES' INTERESTRATES TO REMAIN UNCHANGED FORAPR-JUN QUARTERFor more details, please refer link ://economictimes.indiatimes.com/articleshow/68631133.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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KREO CAPITAL NEWSLETTER - EIGHTH EDITION

SEBI SEEKS GREATER POWERS TOINSPECT BOOKS, FINANCIALRECORDS OF LISTED FIRMS

Key Highlights

• SEBI sought powers to conductinspection of books of accounts oflisted companies if it has reasonablegrounds to believe of indulging ininsider trading and for contraventionof any securities law and also to takedirect action against the fraudsters.

• Besides, SEBI proposed a heavypenalty for altering, destroying,mutilating, concealing or falsifyingrecords or other tangible objects withan intent to obstruct, impede orinfluence a legal investigation.

• In its new proposal, SEBI has askedthe government to broaden thispower to all cases where theregulator suspects a violation of anysecurities law

For more details, please referlink: //economictimes.indiatimes.com/articleshow/68547371.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

SEBI SAYS FROM APRIL 1, 2019,SHARES CAN BE TRANSFERRED INDEMAT FORM ONLY

Key Highlights

• SEBI said transfer of shares of listedcompanies can be done only in thedematerialised (demat) form fromApril 1 but investors are not barredfrom holding shares in the physicalform.

• In December 2018, SEBI hadextended the deadline for transfer ofshares of listed companies only indemat form to April 1.

• Now, it has been decided not toextend the deadline.

• Shares in the demat form would helpin maintaining a transparent record ofshareholding at companies amidrising concerns over beneficialownership of entities.

For more details, please refer link :https://www.moneycontrol.com/news/business/from-april-1-shares-can-be-transferred-in-demat-form-only-sebi-3712461.html

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KREO CAPITAL NEWSLETTER - EIGHTH EDITION

SEBI PROVIDES FRAMEWORK,TIMELINE FOR COUNTER OFFERPROCESS

Key Highlights

• SEBI came out with the frameworkand timeline for the counter offerprocess.

• The counter offer is made in casethe price discovered throughreverse book building (RBB) is notacceptable to the promoter or theacquirer.

• SEBI said the promoters oracquirers making publicannouncement of the offerthrough stock exchangemechanism shall do so within 2days from closure of RBB bidding.

• Publication of counter offer willhave to be made in the samenewspapers where original RBBwas published within four daysfrom the closure of the RBBbidding process.

For more details, please refer link: //economictimes.indiatimes.com/articleshow/68397272.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

SEBI COMES OUT WITHPROCEDURE, FORMATS FORLIMITED REVIEW, AUDIT REPORTS

Key Highlights

• SEBI came out with procedure andformats to be followed for limitedreview and audit report of listedentities.

• This would also be applicable forentities whose accounts are to beconsolidated with the listed entity.

• A new regulation is inserted in LODRnorms after taking into considerationrecommendations made by UdayKotak-led panel on CorporateGovernance.

• It requires the statutory auditor of alisted entity to undertake a limitedreview of the audit of all entitieswhose accounts are to beconsolidated with the listed entity asper Accounting Standard 21.

For more details, please refer link:https://timesofindia.indiatimes.com/business/india-business/sebi-comes-out-with-procedure-formats-for-limited-review-audit-reports/articleshow/68632956.cms

SEBI PANEL LIKELY TO SUGGESTBRINGING ON PAR FPI, FDI CAPS

Key Highlights

• SEBI panel headed by HR Khan is setto recommend liberalisation ofinvestment caps for foreign portfolioinvestors(FPI).

• At present, foreigners can own up to24% in a listed Indian company withany further increase requiringapproval from the firm’s board.

• It proposes removal of 24%restriction & making different sectoralcaps under foreign direct investment(FDI) rules as the new ceiling.

• This will give companies room to raisemoney from foreign investors whileimproving India’s weightage on theMSCI Index.

• RBI initially opposed to the proposalbut committee assuaged RBI’sconcerns.

For more details, please refer link :https://economictimes.indiatimes.com/markets/stocks/news/sebi-panel-likely-to-suggest-bringing-on-par-fpi-fdi-caps/articleshow/68589781.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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SEBI TELLS PRIVATE EQUITY(PE) &VENTURE CAPITAL(VC) FUNDS:NOSIDE DEALS WITH BIG INVESTORS

Key Highlights

• In the club of big boys some investorsare more equal than others. Thenorm given in the world of PE & VCfunds is under the scrutiny of SEBI.

• SEBI is asking these funds, which raisemoney from the rich & ultra-rich, tostop discriminating between investors& refrain from adding clauses ininvestment documents that seem tofavour certain investors.

• Since AIFs are pooled vehicle, SEBIbelieves that all investors in eachclass should enjoy uniform terms.

• SEBI has been raising an issue withdiscretionary terms being offered tosome outside investors who co-invest.

For more details, please refer link:https://economictimes.indiatimes.com/news/company/corporate-trends/sebi-tells-pe-and-vc-funds-no-side-deals-with-big-investors/articleshow/68401431.cms

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RULES TO REVIVE COMPANIESBEFORE LIQUIDATION TO COMEOUT SOON

Key Highlights

• MCA will soon notify regulations onlast possible measures for revival ofcompanies that have been ordered forliquidation through the insolvencyprocess.

• Once the liquidation order is given,the liquidator has to explore Section230 of the Companies Act.

• It is working on the regulation on howthis will be done and the process thatwill be followed.

• This follows a recent order by theNational Company Law AppellateTribunal, in which it directed theliquidator to exhaust options availableunder this section before proceedingto attempt to sell the company whollyor in parts.

For more details, please refer link :https://economictimes.indiatimes.com/news/economy/policy/rules-to-revive-companies-before-liquidation-to-come-out-soon/articleshow/68571841.cms

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KREO CAPITAL NEWSLETTER - EIGHTH EDITION

SEBI DEFERS PROVISION FORSHAREHOLDER NOD FOR RELATEDPARTY ROYALTY PAYMENTS

Key Highlights

• SEBI has deferred implementation ofthe provision to seek shareholderapproval for material payments madeto related parties for brand usage orroyalty, by three months to June 30.

• Such payments are consideredmaterial if exceeds 2% of the annualconsolidated turnover of the listedcompany in the financial year. Theprovision was to come into effectfrom April 1.

• SEBI said it deferred theimplementation of this provision, inview of the representations receivedon the subject.

• SEBI approved proposal forundertaking a public consultationprocess to amend the SEBI (SelfRegulatory Organizations)Regulations, 2004.

For more details, please refer link://economictimes.indiatimes.com/articleshow/68598471.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

CHANGES PLANNED IN E-WAY BILLSYSTEM TO CONTAIN GST EVASION

Key Highlights

• India is eyeing several changes to theelectronic-way bill system, rangingfrom auto calculation of distance formovement of goods to barringbusinesses from generating multiplee-way bills based on one invoice, as itcracks down on evasion in the goodsand services tax (GST) framework.

• E-way bill system will be enabled toauto calculate the distance formovement of goods based on thepostal PIN codes of source anddestination locations while allowing avariation of only 10%.

• The proposed system will also bargeneration of e-way bill for interstatemovement by composition taxpayer.

• The new rules envisage not allowinggeneration of multiple e-way billsbased on one invoice by any party —consignor, consignee and transporter.

For more details, please refer link://economictimes.indiatimes.com/articleshow/68627582.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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NO RESPITE FROM ANGEL TAXDESPITE DPIIT NOTIFICATION

Key Highlights

• Department for Promotion ofIndustry and Internal Trade (DPIIT)notified norms for startups to seekexemption from Section 56(2)(viib) ofthe I-T Act, startups complain thatlittle work has been done on theground to bring them relief from theso-called ‘Angel Tax’ demon.

• 92 startups received emails from theCentral Board of Direct Taxation(CBDT) that acknowledged that theself-declaration that they hadsubmitted to the DPIIT had beenreceived.

• Around 127 companies hadsubmitted Form 2 on February 27,and were expecting a certificate ordocument of some kind which theycould show the I-T Department’sAssessing Officers in order to seekexemptions from Section 56 of the I-TAct.

For more details, please refer link://economictimes.indiatimes.com/articleshow/68474249.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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RBI DEFERS LAUNCH OF IndASAGAIN, AWAITS AMENDMENTS TOTHE BANKING LAWS

Key Highlights

• The RBI has postponed roll out of thenew accounting standards (IndAS) forthe second time.

• It is awaiting amendments to thebanking laws before adopting thenorms.

• The central bank, however, did notspecify the new date for itsimplementation.

• RBI said the legislative amendmentsrecommended by it are underconsideration of the Centre.

• Accordingly, it has been decided todefer implementation of the IndAStill further notice.

• For more details, please refer link :https://www.business-standard.com/article/finance/rbi-defers-launch-of-indas-again-awaits-amendments-to-the-banking-laws-119032300059_1.html

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RBI EASES OFFICE OPENING PROCESSFOR FOREIGN ENTITIES

Key Highlights

• Foreign entities doing business indefence or telecom sector in India willhenceforth not need to seek separateapproval from Reserve Bank of India foropening branch or liaison offices,provided they have clearance from theconcerned ministry.

• This will make office opening processsimple under FEMA Act as the countryis looking to go up the ladder in theease of doing business.

• Earlier, a prior approval from RBI wasmandatory.

• In the case of proposal for opening aPO relating to defence sector, noseparate reference or approval ofgovernment shall be required if thesaid non-resident applicant has beenawarded a contract by/entered into anagreement with the Ministry ofDefence.

For more details, please refer link://economictimes.indiatimes.com/articleshow/68618956.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

BSE GETS NOD TO LAUNCH INTERESTRATES FUTURES ON OVERNIGHTMIBOR

Key Highlights

• Leading stock exchange BSE said it hasreceived approvals to launch interestrates futures on overnight MIBOR(Mumbai Inter-Bank Offer Rate).

• In this regard, the bourse has gotclearance from the SEBI and the RBI.

• MIBOR is the interest rate at whichbanks borrow from one another forshort term purposes. FinancialBenchmarks India Pvt Ltd announcesthe overnight MIBOR on a daily basisand it is computed by the ClearingCorporation of India (CCIL).

• With the opportunity to introduceinterest rate futures on overnightMIBOR, market participant will be ableto forecast and manage interest raterisk on BSE.

For more details, please refer link:https://economictimes.indiatimes.com/articleshow/68603456.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

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NSE : FILING OF INFORMATION ONELECTRONIC PLATFORM

Key Highlights

• The Exchange has introduced onlineportal NSE Electronic ApplicationProcessing System (NEAPS) for filingof documents/information w.r.t.listing of companies pursuant toRegulation 19(2)(b) of SecuritiesContract (Regulations) Rules, 1957(Scheme of Arrangement).

• The Companies are advised to filedocuments/information with theExchange only through NEAPS.

• To submit the documents/information on NEAPS, the Companyneeds to be registered themselves asnew user and Exchange will notaccept any physical copy/email forthe above purpose.

For more details, please refer link:https://www.nseindia.com/content/equities/NSE_Circular_01032019.pdf

CA Varun ParakhManaging DirectorM:+91-9890920892

E: varun@kreocapital.com

HEAD OFFICE:6th floor, B-Wing, Shriram Towers, Civil Lines, Nagpur – 440001.T: +91-0712-6652070

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W: www.kreocapital.com E: info@kreocapital.com

KREO CAPITAL PRIVATE LIMITEDMERCHANT BANKING | CORPORATE ADVISORY | WEALTH MANAGEMENT | LENDING SOLUTIONS

ABOUT OUR CORPORATE ADVISORY SERVICESOur corporate advisory division works with a wide range ofclients including young, cutting-edge start-ups and establishedmarket leaders. We advise our clients on mergers andacquisitions, private equity funding, divestments, corporaterestructuring, valuation of shares as per SEBI guidelines,company law and secretarial advisory.Our advice is built from a rigorous and up-to-dateunderstanding of the market, coupled with clients financialvision. This means we only offer solutions that work best for ourclients.

ABOUT KREO CAPITAL

Kreo Capital is a boutique financial service company with MidMarket focus, offering integrated financial advice andservices. Promoted by professionals with rich experiencein financial and capital markets, Kreo Capital is a financial expertfor all growth oriented companies.

Team Kreo is committed to long term relationships and has aproficient and skilled work force invested in its clients and theirbusiness. Our services enable our clients to access CapitalMarkets, Corporate Finance Advisory, Wealth ManagementAdvisory, Mergers and Acquisition Advisory, ESOP & ValuationAdvisory, Equity/Debt Placements and Restructuring.

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Disclaimer : All data and information is provided for informational purposes only and isnot intended for any factual use. It should not be considered as binding / statutoryprovisions. Neither Kreo Capital, nor any of its group company, directors, or employeesshall be liable for any of the data or content provided for any actions taken in reliance.