PUBIC ISSUE BY LISTED COMPANIES

MADE BYDISHA DHAR

RUBEENA CHIB SAVITA AGARWAL

VIKAS DIWAN

3 WAYS OF RAISING FUNDS

By issuing a prospectus

This is method by which a company seeks to raise capital from public. It invites offer from members of the public to subscribe for its shares and debentures through the prospectus.

By an offer for sale or by deemed prospectus Issuing house publishes a document called an

offer for sale within application from attached offering to the public share or debenture for sale at a price higher than what they had paid

By placing of shares A private ltd company is probhited by the

act and the article from inviting the public for subscription of shares or debentures.

A public company can also raise capital by private placement

Thereby a broker or underwriter find person normally the clients who wish to buys the shares

PUBLIC ISSUE OF SHARES It means selling or marketing of

shares for subscription by the public by issue of prospectus.

The company raise capital from public by issue of shares

Management of public issue involves coordination of activites and cooperation of a number of agencies such as managers to issue underwriters brokers.

Process of issuing of shares divided into

Pre issue-All activities beginning with planning of capital issue till opening of subscription

Post issue- all activities subsequent to opening of subscription list.

Public issue of securities can be made by

Prospectus and issuing of securities in physical form which shall not be listed on any stock exchange.

By prospectus and issuance of securities in dematerialized format.

SEBI Guidelines for issue of equity shares

A company cannot issue securities If it has been prohibited from accessing

capital market by order or direction of SEBI Unless it has made application for listing

of those in stock exchange. A company should enter into a

agreement with depository for dematerializations' of securities already issued or proposed to be issued to the public

Preferntial issue by listed companies

o All preferential issue should comply with requirement with SEBI guidelines

o The offer price should not be less than the higher of average of weekly high and low of closing price of related shares

Fcd/ Pcd/ hares issued on preferential basis are subject to lock in period of 3 years

They can be transferred within the promoters of the company.

Issue of shares /securities of a premium

The company may issue securities at a premium when it is able to sell them at a price above par or above nominal value

The securities whether received in cash or in kind must be kept in account known as “ security premium account”.

In accordance with the provison of section 78(2)

Issuing fully bonus shares to members

Writing off the balance of preliminary expense of the company.

Writing of commission paid or discount allowed

For providing the premium payable on redemption.