Beruflich Dokumente
Kultur Dokumente
Guidelines of
Hi-tech Start-ups and New Businesses Platform
(Institutional Trading Platform)
By CA Anuraag Sharma
Table of Contents
Snap ........................................................................................................................................................................... 3
Advantages................................................................................................................................................................ 3
Eligibility Conditions ................................................................................................................................................. 3
Eligibility Conditions & Proposed Changes ............................................................................................................ 3
Who are Qualified Institutional Buyer................................................................................................................... 3
Who are Other Categories of Investor .................................................................................................................. 4
Maximum Cap on Holding Post-listing Capital ....................................................................................................... 4
Maximum Cap on Holding Post-listing Capital ..................................................................................................... 4
Proposed Changes ................................................................................................................................................. 4
Lock-in Period .......................................................................................................................................................... 4
Lock-in period ....................................................................................................................................................... 4
Proposed Changes ................................................................................................................................................. 5
Trading Lot ............................................................................................................................................................... 5
Trading Lot ............................................................................................................................................................ 5
Proposed Changes ................................................................................................................................................. 5
Migration to Main Board ......................................................................................................................................... 5
Migration to Main Board (Stock Exchange) .......................................................................................................... 5
Market Making ......................................................................................................................................................... 5
Trading Lot ............................................................................................................................................................ 5
Proposed Changes ................................................................................................................................................. 5
Listing without Public Issue ..................................................................................................................................... 5
Listing without Public Issue (without IPO) ............................................................................................................ 5
Exemption.............................................................................................................................................................. 5
Listing pursuant to Public Issue ............................................................................................................................... 6
Listing pursuant to Public Issue (IPO) ................................................................................................................... 6
Proposed Changes ................................................................................................................................................. 6
Exit from Platform .................................................................................................................................................... 6
De-listing from Platform by Stock Exchange............................................................................................................ 7
Conclusion ................................................................................................................................................................. 7
Reference .................................................................................................................................................................. 7
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Snap:Recently SEBI (Security Exchange Board of India) has announced to relax the norms for
listing and trading of shares or securities (equity shares or convertible securities) for
new businesses and startups. SEBI has proposed to rename the existing Institutional
Trading Platform to High-tech Start-up & other new business Platform (earlier
known as Institutional Trading Platform- ITP).
This is a welcoming move by SEBI, and it will be further strengthening the startup
ecosystem and ease of business in India.
Advantages:
However, startups will still need to meet certain requirements and conditions for listing
the securities on such platform; such conditions are mentioned below along-with the
proposed changes
1. Eligibility Conditions:On date of filing draft information, pre-listing issued capital to be held by Qualified
Institutional Buyers (QIBs) by at-least
i.
ii.
2. Maximum Cap on Holding Post-Listing Capital:No person can hold 25% or more of the post-listing capital, individually or
collectively with persons acting in concert.
Proposed Changes: A person can hold more than 25% of shares of the post-listing capital.
3. Lock-in Period:The entire pre-issue capital of the shareholders shall be locked-in for a period of:i.
ii.
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iii.
Period of lock-in to begin from date of allotment (if listing pursuant to public issue) or
date of listing (without public issue).
Proposed Changes: The lock-in of 6 months may apply uniformly to all the categories of shareholders.
4. Trading Lot:The minimum trading lot shall be ten lakh rupees.
Proposed Changes: The minimum trading lot size may be lowered to five lakh rupees.
5. Migration to Main Board (Stock Exchange):The Company may migrate to the main board of stock exchange from the
platform after expiry of three years from the date of listing subject to compliance
with the eligibility requirements of the stock exchange.
6. Market Making:No existing rules for market making.
Proposed Changes: Compulsory market-making for a period of 3 years for issue size of less than
hundred crore rupees to boost liquidity.
7. Listing without public issue (without IPO):The company shall list its specified securities within 30 days from date of filing
of draft information.
The draft & final information shall contain the various disclosures as of the offer
document and shall be signed and certified from true and correct information by
all directors, the Chief Executive Officer, the Managing Director or Manager and
the Chief Financial Officer.
Exemption from the regulations of
allotment;
issue opening / closing;
advertisement;
underwriting;
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Proposed Changes: The allocation in the net offer to public category shall be : Not less than 50% to institutional investors and;
Not more than 50% to non-institutional investors.
The ceiling on allotment to individual institutional investor may be revised
upwards from 10% to 25%.
9. Exit from platform:Companies who have not offered public issue may exit from the platform after
approval from the platforms stock exchange and if:its shareholders approve such exit by passing a special resolution through postal
ballot where 90% of the total votes and the majority of non-promoter votes have
been cast in favor of such exit proposal.
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10.
De-listing from platform by stock exchange:Stock exchange may de-list companies who have not offered public issue and
failed to meet the compliances. In such case, No other company of same common
promoter/director (except independent director) shall be allowed to be listed on
the platform for the next 5 years; from the date of such listing.
Conclusion:The relaxed norms by regulators will strengthen the liquidity position in startups
while also cementing the compliances in fund-raising by new businesses and
startups, providing the excellent opportunities to SMEs, startups and new
businesses to list their companies on stock exchange with the welcoming move by
SEBI.
References:SEBI(ICDR) Regulations, 2016.
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