EQUITY PPT 2022

e pervision of the regulatory authority, the Securities and g platform, where buyers and sellers can meet to transact E is an electronic one and there is no need for buyers and y can trade through the computerized trading screens ernet based trading facility provided by the trading exchange whereby the ownership, the management and d from one another. mutual ship, management and trading are concentrated into a change are both the owners and the traders on the as well. This at times can lead to conflicts of interest in e other hand, has all these three functions clearly rading are in separate hands.

Major Stock Exchange 24

e in World www.isfm.co.in 23 May 2022

Equity Market 25

Current level : 17340 No. of listed co : 2051 Timing : 9:00 am to 3.30 pm Duration : Monday to Friday PE Ratio : 24.5 Market cap : 2.62 T 52 week H / L : 18604 : 12730 Website : www.nseindia.com www.isfm.co.in 23 May 2022

Nifty 50 26

www.isfm.co.in 23 May 2022

Sensex 27

Current level : 58014 No. of listed co : 5328 Timing : 9:00 am to 3.30 pm Duration : Monday to Friday PE Ratio : 28 Market cap : 2.64 T 52 Week H/L Website : 62245 / 43453 : www.bseindia.com www.isfm.co.in 23 May 2022

Participants in Stock M 28

Market www.isfm.co.in 23 May 2022

What is VC 29

www.isfm.co.in 23 May 2022

What is Securities Mar Equity Debt • Shares • Gove • Warrants • Bonds • Mutual Fund • Deben • Exchange traded funds • Mutua • Derivatives • Securi • Financial instruments which are fun • Are usually pu 23 May 2022

rket ernment securities Others s ntures • Collective Investment al fund Schemes ities receipts ngible and has some financial value ublicly traded www.isfm.co.in 30

Market Understanding



What is Primary Market



Types of the Market  Primary Market : Primary Market is a Market for new issue of securi as New Issue Market. It is used by both new and existing companies. funds. The purchaser of new shares and debentures may be business shareholders, etc. The issue of securities is made through the prospec channelizing of funds from individual savers into proper productive i  Secondary Market : Secondary Market refers to a market where se primary market and/or listed on the Stock Exchange. Majority of the of equity markets and the debt markets.  For the general investor, the secondary market provides an efficient company, Secondary equity markets serve as a monitoring and cont implementation of incentive-based management contracts, and aggr decisions.  What is the difference between the primary market and the second  In the primary market, securities are offered to public for subscriptio equity trading avenue in which already existing/pre- issued securitie auction or dealer market. While stock exchange is the part of an au

ities, which are issued to public for first time. Primary market is also known . The company issues new shares and debentures for collecting long term smen, customers of the company, employees of the company, existing ctus. Functioning of primary markets facilitates the capital formation by investments. ecurities are traded after being initially offered to the public in the e trading is done in the secondary market. Secondary market comprises platform for trading of his securities. For the management of the trol conduit—by facilitating value-enhancing control activities, enabling regating information (via price discovery) that guides management dary market? on for the purpose of raising capital or fund. Secondary market is an es are traded amongst investors. Secondary market could be either uction market, Over-the-Counter (OTC) is a part of the dealer market.

Primary Market Offer document Demat A/C Bank A/C ABC Ltd 10,00 IPO 1000 shares 12 day and Syn me 23 May 2022 ASBA Application supported by

Observations by SEBI R&STA 2 after ys closure of Merchant banker IPO ndicate ember 34 www.isfm.co.in

Important days to 35 Minimum of Issu 3 days close Issue open or

remember ue 12th working day es Demat A/C ABC Ltd 1000 shares Bank A/C Refund for the Equity Issue Bank A/C Refund for the Debt Issue www.isfm.co.in 23 May 2022

Primary Market  Products :  • INTIAL PUBLIC OFFER – IPO  • FOLLOWING PUBLIC OFFER– FPO  • RIGHTS ISSUE  • PRIVATE PLACEMENT  • PREFERENTIAL ALLOTMENT

Participants : Resident Individuals HUF Minors through guardians Registered Societies and Club NRI PIO Qualified Foreigh Investor Banks Financial Institutions Association of Person Companies Partnership Firm Trust FII DII LLP

IPO History



Latest IPO Perform

mance 2020

Latest IPO Perform

mance 2020

Entry Norms Initial Public An IPO stands for Initial Pub Offering (IPO) public for the first time. Inves the share gets listed in a reg issue proceeds for its develo 1. Net Tangible assets of atleast Rs.3Cr 1. Issue shall be only t for 3 full years book building route wit 2. Distributable profits in atleast 3yrs 50% allotted mandator 3. Net worth of atleast Rs1Cr in 3 years Qualified Institutional B 4. If there was a change in name, atleast (QIBs) 50% of the revenue in the preceeding 2. The minimum post i year should be from the new activity value capital shall be R 5. The issue size should not exceed 5 crores or there shall be times the pre-issue networth of the compulsory market-ma atleast 2 years comp2a3ny May 2022

for IPO www.isfm.co.in blic Offering, wherein a company issues its shares to the stors can place requests to buy these shares and once done, gistered stock exchange and the company uses the share opment/growth. through the 1. The “Project” is appraised and th atleast participated to the extent of 15% by rily to FI’s/Scheduled Commercial Banks of Buyers which atleast 10% comes from the appraiser(s). issue face 2. The minimum post issue face value Rs. 10 capital shall be Rs. 10 crores or there ea shall be a compulsory market-making for aking for atleast 2 years 3. In addition to the above mentioned 2 points, the company shall also satisfy the criteria of having atleast 1000 prospective allottees in future.

IPO Eligibility Conditions  Net worth of Minimum Rs 1 crore  Net tangible assets of Rs 3 crore years  Track record of profitability of 3  Promoters should have minimum and the same subject to a lock in

s e es in each of the preceding three 3 out of past 5 years 20 per cent of the post issue capital n period of minimum 3 years.

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www.isfm.co.in 23 May 2022





PROCESS FOR PUBLIC ISSU  Approval of the board of directors  Approval of shareholders  Appointment of the lead manager  Due diligence by the lead manager  Appointment of other intermediaries like co managers, advisors, underwriters,  bankers, brokers, and registrars  Preparation of the draft prospectus  Filing of the draft prospectus with SEBI  Application for listing in stock exchanges  Filing of the prospectus (after any modifications suggested by SEBI) with the

UE IN INDIA  Registrar of Companies  Promotion of the issue  Printing and distribution of applications  Statutory announcement o-  Collection of applications  Processing of applications  Determination of the liability of underwriters  Finalisation of allotment  Giving of demat credit (or dispatch of share certificates) and refund orders  Listing of the issue

Book building – Discover  SEBI guidelines defines Book Building as \"a process proposed to be issued by a body corporate is elici assessed for the determination of the quantum of s advertisement, document or information memorand  Book Building is basically a process used in Initial P mechanism where, during the period for which the prices, which are above or equal to the floor price  As per SEBI guidelines, an issuer company can issue manner:  100% of the net offer to the public through book b  75% of the net offer to the public through book bu book building. The Fixed Price portion is conducted during which the issue price is determined.  The concept of Book Building is relatively new in In countries.

ring the price s undertaken by which a demand for the securities ited and built-up and the price for such securities is such securities to be issued by means of a notice, circular, da or offer document\". Public Offer (IPO) for efficient price discovery. It is a IPO is open, bids are collected from investors at various e. The offer price is determined after the bid closing date. e securities to the public though prospectus in the following building process uilding process and 25% at the price determined through d like a normal public issue after the Book Built portion, ndia. However it is a common practice in most developed

What is ASBA Facility  ASBA means “Application Supported by Blocked Amount”. A application money in the bank account, for subscribing to a money shall be debited from the bank account only if his/h is finalized, or the issue is withdrawn/failed.  Under the ASBA facility, investors can apply in any public/ the ASBA form (its colour is different from the normal applic the banks approved for providing the facility) after filling d (PAN) number, demat account number, bid quantity, bid pric instruction to block the amount in their account. In turn, the b platform. Investors must ensure that the details that are fille rejected.  While it is necessary for you to hold an account with the ba demat account with the same bank. You can avail the option  Why use the facility?  Prior to Asba, while applying in an IPO, the entire amount h retail investors. In case there was no allotment or part-allotm days. This was a lost opportunity as the funds did not earn made via Asba, the funds stay blocked in your account, but shift to interest calculation on the daily balance.

ASBA is an application containing an authorization to block the an issue. If an investor is applying through ASBA, his application her application is selected for allotment after the basis of allotment /rights issue by using their bank account. Investors must submit cation form and is available at the designated branches of details such as name of the applicant, permanent account number ce and other relevant details, to their banking branch with an bank uploads the details of the application in the bidding ed in the ASBA form are correct, otherwise the form is liable to be ank to opt for this facility, it is not necessary for you to hold the n either online through net-banking or by submitting it to the bank. had to be paid upfront, even before an allotment by ment, the amount would get refunded to the applicant after 20-30 any interest during the period either. However, if the application is t continue to earn the interest. It is especially important after the

What is ASBA 47 No issue of ASBA application Amount for th issue blocke investor’s a Continues to ea

f refund he applied After allotment, the amount ed in the applicable debited and the account balance amount unlocked arn interest www.isfm.co.in 23 May 2022

IPO Pricing Book building process :  Price Band or floor price below which qu cannot be given or gets rejected  The spread between the cap and the floor cannot be more than 20%  Demand known as book is being built  The actual discovered issue price – Cut off pri