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INVOLVEMENT OF KEY PARTIESINVOLVEMENT OF KEY PARTIESDURING ISSUING OF AN IPODURING ISSUING OF AN IPO

PRESENTED BYVIMAL PRAKASH

4TH

TRIM. (PGDM)

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INTRODUCTION

Financial capital is one of the most important components of a business. Theneed for financial capital grows with a growth in the business. At a certainstage, it becomes imperative to raise a large amount of financial capital toexpend and sustain the business, and at an affordable cost to the company.An IPO is one of the most popular methods of raising money from thegeneral public and investors.

INITIAL PUBLIC OFFER(IPO)INITIAL PUBLIC OFFER(IPO)

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q Investorsq Issuer q Lead managersq Syndicate membersq

Underwritersq Registrar q Legal advisersq Auditorsq Regulators-SEBIq Stock Exchange Regulationsq Advertisement agency/prinersqq

KEY PARTIESKEY PARTIES

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InvestorsCategories of Investorsq

Qualified Institutional Buyers (QIBs)q High Networth Individual (HNIs)q Retail Individual Investors

Issuer- Issuer is a legal entity that develops, registers andsells securities for the purpose of financing its operations.

Key parties conti..Key parties conti..

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Lead managers- Lead managers are independent financial institutionsappointed by the company going public to manage the IPO. They are themain body responsible for most of the IPO processing.

Syndicate members- Syndicate members are commercial or investment banks responsible for underwriting IPO's. Syndicate membersare usually registered with SEBI or registered as brokers with BSE / NSEStock Exchanges. They are also responsible for accepting the bids,

payments and application forms for the public issue, work online asq Name of the investor.q Investor Category Individual, Corporate, NRI, FII, or Mutual Fund

etc.q

Numbers of Equity Shares bid for.q Bid Amountq Depository Participant Identification Number and Client

Identification Number of the beneficiary account of the Bidder.

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Auditors - The company auditors will help the chief financialofficer address accounting issues and prepare the financialdisclosures required in the prospectus.

Regulators, SEBI- Through public issues, SEBI has laiddown eligibility norms for entities accessing the primarymarket.

q Net Tangible Assets of at least Rs. 3 crores for 3 full years.q Distributable profits in atleast three years.q Net worth of at least Rs. 1 crore in three years.q If change in name, atleast 50% revenue for preceding 1 year

should be from the new activity.q The issue size does not exceed 5 times the pre- issue net worth.

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Stock Exchange Regulators- While each exchange offers itsadvantages and disadvantages, a company contemplating a

public offering will often focus on the exchange's listingrequirements, which include the following factors:

q Market value and share size of public floatq

Net tangible assetsq Number of shareholdersq Share priceAdvertisement agency Finally, the financial printer will print the prospectus, the transfer agent will issue and transfer

the company's shares and coordinate shareholder mailings, andthe bank note company will design and print the new stock certificates.

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Tha nk you