AIBI Due Diligence Manual

Only for Limited Circulation to the Members of AIBI
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ASSOCIATION OF INVESTMENT BANKERS OF INDIA
505 506, Dalamal Chambers, 5th Floor,

29, New Marine Lines, Mumbai 400 020
Phone: +91-22-2209-6947
E Mail: ceo.aibi@gmail.com
Website: www.aibi.org.in
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Dear Members,
We are glad to inform you that your Association, in its endeavour to continuously assist
you in your business activities and establish best practices for the industry, has prepared
a Due Diligence Manual which can be used as an indicative guide for diligence standards
for public offerings.
We are all aware of the importance and critical role of due diligence and the consequent
disclosure, to all classes of investors (institutional or retail) globally, in making their
investment decisions. We therefore hope this manual will establish a high and uniform
standard of diligence across the industry and thereby enhance the credibility of the Issuer
and the investment banking community.
We have adopted a detailed consultative approach in preparing this manual which
included interactions amongst AIBI members, interactions and insights from domestic
and international legal experts specialising in securities law. The manual has built on the
prevailing practices of due diligence and sought to bring it on par with global benchmarks
to the extent practicable.
We acknowledge the contributions from all the members of AIBI,their representatives on
the Due Diligence Committee and the AIBI secretariat for their persistent efforts in this
compilation.
We would like place on record our acknowledgement and appreciation of the efforts by
the team at Amarchand & Mangaldas & Suresh A. Shroff & Co. in sparing their valuable
time and without whose efforts this compilation would have been incomplete.
We solicit your continued support in making your Association a truly pro-active Association.
With best regards
Board of Directors
Association of Investment Bankers of India
August 2012
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Table Of Contents
Contents
Preface 2
Introduction 3
Annexure A List Of Documents For Review In A Public Offering 10
1. Issue Related Information 10
2. Capital Structure 13
3. Objects Of The Issue 16
4. Industry 22
5. Business 24
6. History And Certain Incorporation Matters 26
7. Management 27
8. Promoters, Promoter Group And Group Companies 30
9. Financial Information 34
10. Litigation 36
11. Government Approvals 42
12. Basis of Allotment 43
13. Anchor Portion 47
Annexure B Indicative Retention List Of Information/Documents In A 48

Public Offering
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Disclaimer
This Manual is intended only to be an indicative guide for diligence standards and
retention of documents in respect of public offerings and rights issues in India. Diligence
standards in respect of certain chapters such as Business, Risk Factors, etc., could differ
substantially depending on factors including the industry to which the issuer company
(Issuer) belongs and the dynamics of its business operations. Further depending on the
types of offering (Initial Public Offerings, Follow-on Public Offerings, etc.), the regulatory
requirements and disclosure may differ. It is recognized that the due diligence process
employed in connection with any particular public offering in India may vary from situation
to situation, and the appropriate diligence procedures will need to be determined by the
parties in light of, among other things, the relevant Issuer and the type of transaction.
The Manual does not have the force of law nor is it otherwise legally binding on members
of the Association of Investment Bankers of India (AIBI).
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PREFACE
The Indian nancial markets have been through a continuous process of transformation
since economic liberalization was introduced in 1991. Post the formation of the Securities
and Exchange Board of India (SEBI) in 1992, the Indian capital markets have seen
landmark systemic changes and now rank at par with many developed jurisdictions in
terms of infrastructure, processes and policies. This applies equally to activities in primary
as well as secondary capital markets.
Merchant Bankers (as dened in the Securities and Exchange Board of India (Merchant
Bankers) Regulations, 1992, as amended -the Merchant Bankers Regulations) are
required to act with integrity and fairness and comply with the Code of Conduct for Merchant
Bankers as set out in the Merchant Bankers Regulations (the Code of Conduct). This
requires Lead Managers to develop a fair understanding of various facets of an Issuers
business and operations which can enable the drafting of appropriate disclosures in offer
documents (the Offer Document(s)) to facilitate informed investment decisions being
made by an investor.
This Manual is an endeavour at setting out certain guiding principles for diligence and
record keeping which Lead Managers are expected to follow while performing their role
as lead managers (the Lead Manager(s)) in terms of the Securities and Exchange
Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as
amended (the ICDR Regulations), for the purpose of public offerings. The disclosure
based regime and the resultant due diligence process is a complex, dynamic and
evolving. The Manual has been framed to serve as a guide to Lead Managers while
conducting due diligence for making appropriate disclosures in the Offer Documents and
retention of documents. It should however be noted that each Issuer and transaction
has its own unique requirements which are specic to its business and accordingly, the
due diligence exercise for each transaction and Issuer needs to be customised. Each
intermediary needs to be cognizant of the dynamic nature of due diligence and recognise
that this manual is indicative in nature and strict compliance with this manual may not be
adequate in certain or all cases or required in other cases. While this manual attempts to
lay down due diligence standards, there could be methods other than those mentioned in
this manual through which reasonable due diligence could be conducted.
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INTRODUCTION
1. Regulatory framework and scope of due diligence
1.1 The Code of Conduct requires a Lead Manager, amongst other things, to exercise
due diligence, ensure proper care and exercise independent professional judgment.
Further, it requires a Lead Manager to ensure that adequate disclosures are made to
potential investors in a timely manner in accordance with the applicable regulations
and guidelines so as to enable them to make a balanced and informed investment
decision. An amendment to the Lead Managers Regulations dated August 16, 2011
requires Lead Managers to maintain records and documents pertaining to due
diligence exercised in pre-issue and post-issue matters for a minimum period of
ve years. The ICDR Regulations require that Offer Documents should contain all
material disclosures, which are true and adequate to enable prospective investors to
take an informed decision. Furthermore, the ICDR Regulations require due diligence
certicates to be issued by the Lead Managers at various stages of the transaction.
1.2 Whilst the regulatory framework does not specically dene what constitutes due
diligence, as a matter of practice, the objective of due diligence is to collect information
about the Issuer that helps the Lead Manager draft as well as assess disclosures that
are made in the Offer Document. It is pertinent to understand that while the Lead
Manager continues to be responsible for due diligence, external expert assistance
is necessary. Whilst under the Code of Conduct, the Lead Managers are required
to demonstrate that all reasonable steps were taken to exercise due diligence and
ensure adequate disclosures were made to potential investors, they should have the
exibility regarding the manner in which the due diligence exercise is conducted as
they may not possess the expertise with respect to certain aspects of due diligence,
such as technical, legal and accounting matters.
1.3 In terms of the ICDR Regulations, the Lead Managers are required to submit due
diligence certicate(s) to SEBI at various stages of a transaction and the formats for
such certicates have been provided in the ICDR Regulations. An examination of the
format of the due diligence certicate provides clarity of expectations from the Lead
Manager, to a certain extent, and can act as guiding principles for the diligence to
be exercised. On the basis of the same, the scope of due diligence should cover the
following aspects:
(i) Reliance on the Issuer: The diligence exercise should include discussions with
the Issuer in addition to review of documents sought by the Lead Manager. The
due diligence process recognizes that the Lead Manager will conduct the due
diligence exercise for which the Issuer shall provide the necessary information
and discuss the issues identied by the Lead Managers.
(ii) Examination of facts based on documents: A Lead Manager is required to
examine various documents provided by the Issuer to understand the various
aspect of the business (es) which have been identied for disclosure in the Offer
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Document. A review and examination of such documents provided by an Issuer,

consequently disclosure of the same adequately in the Offer Documents should
be construed as adequate diligence.
(iii) Independent review: The expectation is for Lead Managers to independently
review all documents and information provided by the Issuer. In this respect,
please see Annexure A for a List of Documents for Review in a Public
Offering. It would be pertinent to note the following points:
In conducting a due diligence exercise, it may not always be appropriate for
a Lead Manager to accept the accuracy and completeness of all information
given by the Issuer. To the extent reasonable and where appropriate, Lead
Managers should carry out or request advisers or experts to carry out,
check and verications on information provided by the Issuer.
If reasonably appropriate, Lead Managers should also consider conducting
interviews (by way of questionnaires or calls) with key employees of the
Issuer and its material subsidiaries, key customers or suppliers (where
practicable). Other independent verication exercises include site visits
and independent background checks on the Issuer, promoters, its group
companies, directors and management, through websites such as www.
sebi.gov.in, www.mca.gov.in, www.watchoutinvestor.com, www.cibil.com,
list of willful defaulters on the RBI website (www.rbi.org.in) as well as the
NSE, BSE website for a list of persons/entities debarred from accessing the
capital markets or for listed companies where trading is suspended (www.
nseindia.com, www.bseindia.com).
In order to facilitate the due diligence process, the Lead Managers, with the
assistance of the legal advisers, should brief or arrange for the Issuers legal
adviser to brief, the Issuer, its directors and management on their responsibilities
and liabilities in connection with the Issue, including but not limited to those set out
under the Companies Act, the ICDR Regulations and the listing agreement with
stock exchanges, with special emphasis on the need for the Issuer to extend full
cooperation and for independence in the check and verication process. For more
details on this process, please see section 6 below.
It is important not to confuse due diligence with investigation and to understand that
the scope of due diligence is to carry out review of information and an independent
examination of facts and documents provided by the Issuer, to such extent as
practicable and reasonable, which assists in review and drafting disclosures for
the Offer Documents such that there are no material omissions or mis-statements
and to enable prospective investors to make an informed investment decision.
In this context, it is pertinent to draw reference to a landmark pronouncement of
the Securities Appellate Tribunal which states that a Lead Manager is required to
employ reasonable skill and care but he is not required to begin with suspicion and to
proceed in a manner of trying to detect a fraud or lie unless such information excites
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his suspicion or ought to excite his suspicion as a professional man of reasonable

competence.1
2. Due Diligence Procedure
A Lead Manager is expected to carry out the following procedures to demonstrate that
it had no reasonable ground to believe and did not believe that there were material
misstatements or omissions (in light of the circumstances under which they were
made) in the Offer Documents which could have had an impact on an investment
decision:
(i) Develop a fair understanding of business activities and the associated risks;
(ii) Have detailed discussions with the management and key customers, suppliers
(where practicable) and the Issuers auditors with respect to the business and
associated risks and nancial reporting statements;
(iii) Identify procedures such that disclosures in the Offer Documents that are
material to an investment decision are backed by appropriate documentation,
such as corporate and secretarial records or certicates of the Issuer or third
parties and independent third party reports; and
(iv) Inform the Issuer that it may be required to provide documents that have been
reviewed for an Issue, post completion of the Issue in instances of receipt of
clarications or questions from SEBI or other regulatory agencies or other
persons.
3. Role of external parties in the due diligence process
3.1 During the due diligence process, the Lead Manager and the Issuer are assisted by
external agencies such as legal counsels, statutory auditors and specialized industry
experts, if required. The legal counsel may assist the Lead Manager in carrying out
legal due diligence, assisting the Issuer in the preparation of the Offer Documents
in compliance with ICDR Regulations, the Companies Act, 1956, as amended (the
Companies Act) and other applicable laws and advising the Lead Managers and
the Issuer on legal matters relating to the offering. In addition, the legal counsels
also issue legal opinions in relation to the issue to the Lead Managers. The statutory
auditors of the Issuer also provide their reports on the nancial information included in
the Offer Documents and other relevant certications pertaining to the issue including
comfort letters for nancial information included in the Offer Documents. In case
the Issuer belongs to any specialized industry (like oil or gas or mining business)
or has a project which requires technical expertise, independent expert(s) may be
appointed and their reports (like reserve reports or appraisal or feasibility report for
a project) be procured. The report may then be disclosed in the Offer Documents for
investor information and the report shall be made available as a material document
1 In the matter of Imperial Corporate Finance & Services Pvt. Ltd., Mumbai (Appeal
No.56/2003 before the Securities Appellate Tribunal).
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for inspection. The independent expert(s) whose report is disclosed in the Offer
Documents is typically named as an expert in Offer Documents in terms of the
Companies Act. However, the Lead Managers continue to be responsible for such
disclosures to the extent that the Code of Conduct requires the Lead Managers to
exercise independent professional judgment with respect to the same.
3.2 The Lead Manager should advise the Issuer on appointment of appropriately qualied
and experienced advisers and experts. When the Lead Manager seeks to rely on the
advisers and/or experts in respect of areas beyond its expertise, the Lead Manager
(together with the Issuer) should satisfy itself that such reliance is reasonable in the
circumstances. The Lead Manager should, as far as practicable, be involved in the
appointment and selection of advisers and experts. Where such advisers or experts
have already been engaged prior to the Lead Managers involvement, the Lead
Manager should nonetheless consider the suitability of those advisers and experts
and advise the Issuer accordingly.
3.3 While relying upon the work of experts, the Lead Manager should take reasonable care
that appropriate enquiries are made to ascertain the work performed and procedures
carried out by them. The Lead Manager can also obtain (where necessary) relevant
certications / comforts from these external parties. Any qualications in an experts
report must be discussed with the Issuer to understand the related risks which should
be disclosed in the Offer Document.
3.4 Whilst, certain aspects of the due diligence process are assisted to by legal advisers,
experts and other intermediaries, Lead Managers should remain responsible for the
conduct of reasonable due diligence and appropriateness of disclosure in the Offer
Documents.
4. Expertised vs. nonexpertised contents of the Offer Document
Based on the above (i.e., work performed by external parties), and in line with
international practices, the Offer Documents contains expertised and non-
expertised portions. In relation to the expertised portion, e.g., the nancial
statements and the technical reports etc., the Lead Managers should be able to rely
on the reports / information / certications provided for disclosure purposes. The
Lead Managers should endeavour to satisfy themselves that it is reasonable to rely
on the information provided by the expert including:
(i) the competence of the expert qualications, experience and afliations, if any,
resources;
(ii) scope of the work to be undertaken by the expert being appropriate to the report/
opinion / certicate required;
(iii) report / opinion / certicate being consistent with information being reviewed or
may be known to the Lead Managers (publicly or during the course of interaction
with the Issuer) and in accordance with industry practice; and
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(iv) the experts independence from the Issuer, its promoters and its afliates.
5. Concept of Materiality
5.1 The concept of materiality is crucial to the efcacy of securities laws. Materiality
analysis serves a dual function in the disclosure process. Firstly, materiality analysis
shapes the content of mandatory disclosure required under securities laws.
Secondly, materiality analysis shapes the content of clarifying disclosure; information
not expressly mandated by disclosure requirements needs to be disclosed only if
it is material and necessary to ensure that there is no misstatement or omission of
a material fact (in light of the circumstances under which they were made) in the
Offer Documents. Therefore, materiality analysis pervades a number of aspects of a
securities regulation regime.
5.2 Regulation 57(1) of the ICDR Regulations stipulates that the Offer Document shall
contain all material disclosures which are true and adequate so as to enable the
applicants to take an informed investment decision. In addition, the ICDR Regulations
contain various references to materiality, especially in relation to disclosures. The
Companies Act does not specically provide a materiality threshold. The ICDR
Regulations provides limited guidance as to the factors that could be considered
for determining materiality in the context of public offerings. Also, the adequacy of
disclosures in terms of materiality is brought to test when any query or complaint or
litigation is initiated by an external party or any report in the media is published. In
general, jurisprudence in most developed capital markets indicates that qualitative
and quantitative factors are both important to determine materiality. For example, in
the U.S., there is judicial precedent to the effect that a material fact is one to which
there is substantial likelihood that a reasonable investor would attach importance in
making a decision because the fact would signicantly alter the total mix of available
information.
5.3 The determination of materiality must be an objective exercise undertaken by the Lead
Manager, in consultation and discussions with the Issuer and other intermediaries/
advisors such as legal counsels and auditors, and shall depend on the quantitative
as well as qualitative factors relevant to each Issuer.
5.4 The Lead Manager shall, in consultation with legal counsel, endeavour to document
the basis of determining materiality thresholds and in doing so, it shall endeavour to
ensure that the scope of materiality covers items which may materially and adversely
affect the business operations or nancial condition of the Issuer and its subsidiaries,
taken as a whole. The process for documenting the basis for determining materiality
for the purposes of disclosures in the Offer Document can also serve as a due
diligence defence for the Lead Manager.
6. Indicative key steps to make due diligence more effective
As the due diligence exercise depends primarily on information being made available
by the Issuer, the Lead Manager must endeavour to educate the management of
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the Issuer about the requirement for complete and accurate disclosures in the Offer
Document and the potential risk and liability arising out of omission or inadequacy
of such disclosures. The following steps may be taken to make the due diligence
process more effective.
6.1 Set the groundwork early
(i) Discuss with the Issuer about the scope and importance of due diligence
exercise early in the offering process;
(ii) Request Issuer to designate an ofcer of or team who will serve as the main
contact person for due diligence at the Issuer;
(iii) Make the Issuer aware that due diligence by the Lead Managers is an essential
part of the offering process and request for a person be designated for this
exercise until the listing;
(iv) Provide a due diligence request list early in the process; the request list should
be prepared in consultation with legal counsel and should be supplemented as
required;
(v) Meetings with key business heads should be organised with periodic follow-ups
to receive relevant and updated information.
6.2 Allot sufcient time for due diligence
When discussing the timetable with the Issuer, allot sufcient time for conducting due
diligence.
6.3 Be informed
Stay apprised of material business updates and issues throughout the offering
process to permit adequate due diligence on such issues.
6.4 Raise legal or business issues early in the process
Raise material legal or business issues with the Issuer as soon as the Lead Manager
become aware of them to ensure timely and satisfactory redressal.
6.5 Management / auditors due diligence, site visits and third party calls
(i) The Lead Managers should conduct and supervise the due diligence process,
from management due diligence sessions to site visits to calls with auditors,
signicant customers, suppliers, lenders and other third parties, where applicable;
(ii) Documentation of the site visit.
6.6 Monitor the process
Monitor the status of the due diligence process during the course of the offering to
ensure that the Issuer is cooperating adequately and that the Lead Manager has
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sufcient access to relevant records and personnel to complete an adequate and

timely due diligence exercise.
6.7 Be aware of critical dates
The due diligence process should largely be completed prior to the initial ling of
the draft Offer Document with SEBI. Given the dynamic nature of businesses, the
due diligence process will, of course, continue after the initial ling until the listing
of the shares. Bring down due diligence sessions/calls should be arranged prior to
signicant activity milestones such as the ling of Offer Documents with the Registrar
of Companies and allotment of shares.
7. Key due diligence documentation records
7.1 The Lead Managers should retain various issue-related documents for the following
key reasons:
(i) These documents constitute evidence that due diligence has been conducted as
well as compliance with regulatory requirements for maintaining due diligence
records; and
(ii) These documents are likely to be the rst information that a plaintiff or a regulator
would request to see in case of litigation or investigation, as applicable.
7.2 The Lead Manager should maintain a due diligence le containing certain minimum
documentation. For details of the documents that may be maintained, please see
Annexure B on List of Documents for Retention.
8. Standards of Record-keeping
8.1 Form
In the current environment, electronic copies (in lieu of hard copies) of the due
diligence documents should be acceptable and Issuer conrmations that these are
true and certied copies, for such documents should not be mandatory.
8.2 Client condentiality
It may not be possible to retain documents which are commercially sensitive to the
business of the Issuer. Typically in such cases, the documents may be reviewed by
the Lead Managers and the legal counsel at the Issuers premises and copies may
not be retained. However, a list of such documents have been reviewed could be
maintained.
9. Summing up
It must be clearly understood that due diligence is the backbone of any primary
market offering. The risk that the Lead Manager runs for any lapse in conducting due
diligence is not restricted only to any regulatory action but extends to reputational risk
with the investors (institutional as well as retail) and prospective clients (Issuers).
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ANNEXURE A
LIST OF DOCUMENTS FOR REVIEW IN A PUBLIC OFFERING

The following list sets out certain documents which should be considered for review when conducting a due diligence exercise for a
public offer (Issue). This document list is purely illustrative and does not attempt to include any industry, sector or transaction specic
information. This list may require modications based on specic transaction circumstances.
Please note that in this Checklist:
(a) Issuer means issuer company;
(b) Subsidiaries and Joint Venture means the subsidiaries and joint ventures of the Issuer;
(c) Promoter and Promoter Group has such meaning as provided in the ICDR Regulations;
(d) Group Companies means companies, rms, ventures, etc promoted by the promoters of the Issuer, irrespective of whether these
are covered under Section 370 (1B) of the Companies Act, 1956 (Companies Act); and
(e) Offer Documents means collectively the relevant offer documents including the Draft Red Herring Prospectus (DRHP)/ Draft
Letter of Offer (DLOF), the Red Herring Prospectus (RHP) and the Prospectus/ Letter of Offer (LOF).
Manner of diligence Documents to be reviewed and Basis of Due Diligence External / third party
review
1. ISSUE RELATED INFORMATION
Diligence of eligibility is a mix of For eligibility requirements under Regulation 4(2): Website checks and
nancial analysis, factual data review 1. Certication from the Issuer, promoters of the Issuer, review of publicly available
and independent assessment of data promoter group, directors and persons in control of the information.
available with the Issuer and publicly Issuer in relation to the eligibility criteria in terms of the
available information Securities and Exchange Board of India (Issue of Capital
and Disclosure Requirements) Regulations, 2009, as
amended (ICDR Regulations).
2. Copy of agreements with NSDL / CDSL.
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review
3. Sanction letter(s) from lenders, if applicable, appraisal
reports and deployment certicates issued by a Chartered
Accountant including management certicate for cost
of project to ascertain rm arrangements of nance as
required under Regulation 4(2) (g), if appraisal report is
not available.
For eligibility requirements under Regulation 26:
1. Audited Financial Statements of Issuer for last 5 years
(standalone and consolidated).
2. Where the Issuer holds more than 50% of its net tangible
assets as monetary assets, then an undertaking from the
Issuer, and/ or any agreements, regarding commitments
for utilization of such monetary assets in business or
project.
3. Fresh Certicate of Incorporation, evidencing a change of
name of Issuer wherever applicable.
4. A Chartered Accountants (CA) certicate on nancial
eligibility criteria (specied under Regulation 26(1)) based
on standalone and consolidated accounts.
5. IPO Grading Report (at RHP ling).
For eligibility requirements under Regulation 26(5) and
(6) in connection with convertible securities and securities
offered in an offer for sale, see Capital Structure below.
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review
6. In case of an offer for sale of existing shares, documents
in relation of issuance of such shares and allotment
registers, transfer registers Demat statement and selling
shareholder certicate conrming that these shares were
held for more than one year by the seller.
Resolutions and Approvals
1. Certied true copy of the extract of the resolution of the
Board of Directors authorizing the Issue and seeking
approval of the shareholders by convening a general
meeting as well as the certied true copy of the extract of
the resolution of the shareholders authorizing the Issue
along with delegation of authority to a board committee.
2. Board and Shareholders approval for increase in
authorised capital, where necessary.
3. Approval of the Board or a committee thereof for the each
of the Offer Documents to be led with SEBI and the RoC,
as appropriate.
4. Board and shareholder approval for increasing borrowing
power and creating a charge on assets, as applicable for
debenture issuance.
5. Applications for and in-principle approvals from each
of the stock exchanges on which the equity shares are
proposed to be listed.
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review
6. Final listing and trading approvals from each of the stock
exchanges on which the equity shares are proposed to be
listed.
7. Approval from regulatory authorities such as FIPB/RBI
where applicable.
8. Approval from lenders where the covenants of agreements
requires seeking their approval.
9. Requisite approval from the selling shareholder in case of
an Offer for Sale.
10. Approval from the Competition Commission of India, if
applicable.
2. CAPITAL STRUCTURE
Due diligence of capital structure 1. Copy of the Memorandum of Association, for details 1. Website check
comprises of review of corporate including any changes to the authorized capital. publicly available
records of the Issuer, review of data 2. Review of annual reports and other lings such as other information on the
furnished by the Issuer, obtaining directorships of each director to identify the constitution Ministry of Corporate
management, promoter and promoter of Promoter Group. Affairs websites.
group information and certicates and 3. All lings with RoC/ Stock Exchanges related to the
allotment of shares since the inception of the company. 2. Review of lings
certain external checks for regulatory with RoC and Stock
compliances. 4. Promoter group constitution certied by promoter(s).
exchanges.
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review
Review that the shares (including bonus 5. Undertaking from promoters regarding promoters
and those issued for consideration contribution and lock-in. If applicable, review of documents
other than cash) considered for regarding arrangements that have been made to ensure
that the equity shares contributed towards promoters
minimum promoters contribution are
contribution are eligible therefor at least one day prior
eligible in terms of ICDR Regulations. to the Bid/ Issue Opening Date. This may include CA
Check if there are any outstanding certicate regarding promoters contribution in escrow
convertible securities and ensure they a/c, if applicable.
are converted in accordance with 6. Final scheme of arrangement along with court order
ICDR Regulations and appropriate pursuant to which shares have been allotted.
disclosures are made in the DRHP. 7. ESOP Scheme.
8. Agreement for pledge of shares, if any, by promoter(s)
and promoter group. In case pledge is withdrawn for the
purpose of the public issue a conrmation from the lender
in relation to such a withdrawal.
9. Previous Offer Documents, if any, for details of any issue
within the last 2 years.
10. In the event of an offer for sale, conrmations from the
selling shareholder regarding the eligibility of the sale of
offer for sale shares.
11. CA certicate for revaluation of assets, ESOP scheme
compliance and average cost of acquisition by promoters.
12. Certication from the Issuer about the shares exempted
from Lock in (held by FVCI) and on the Issuers intention/
consideration to alter capital structure for a period of six
months after issue opening date.
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review
13. Undertaking from promoters / promoter group not to
subscribe under the issue.
14. Board / committee and shareholders minutes for last
ve years (and specically for all share capital related
matters).
15. Register of members or depositary statement showing
list of members.
Conrmations from other Lead Managers, if any, on
details of shares held by them or their associates in the
Issuer.
16. Register of transfer and information of purchase and sale
by Promoter, Promoter Group and directors in the last six
months before ling the Offer Document and thereafter
till listing including details of any nancing arrangement
for the same and conrmations from the respective
Promoter, Promoter Group and director and the Issuer.
17. Relevant certicates to conrm that no direct or
indirect arrangements have been made by Promoters,
Group Companies, associates, directors and Issuer to
subscribe to the shares in the public issue or buyback
shares from any person subscribing in the public issue.
18. A conrmation from the issuer that the relevant
regulations have been complied with in all past issues.
19. Lock in conrmation from Promoters.
20. Document relating to all previous issuances by the
company and a conrmation from the issuer that Section
67 of the Companies Act, 1956 was complied with for
each issuance.
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review
3. OBJECTS OF THE ISSUE
Diligence is conducted in the following The different kinds of documents that should be reviewed 1. Appraisal report by
manner: depend upon the objects of the issue. These could include independent agency,
1. The aggregate quantum of funds the following: in case of appraised
proposed to be raised is examined 1. Objects of the issue are purchase of equipment, projects.
in view of the fund requirements machinery or furniture and xtures 2. Where appraisal is
of the Issuer and the proposed Valid quotations from suppliers / contractors subject to not done, third party
dilution which the Issuer wishes to the following: reports such as
undertake through the Issue. technical consultants
2. The purpose for which funds are In situations where it is commercially sensitive to or architects or a
required are assessed in view of mention names of the suppliers / contractors, the dates civil engineering
the growth strategies of the Issuer and other relevant details such as the price quoted are consultants report or
disclosed in the Offer Document. a technical experts
as elaborated in the business
Where quotations are not obtained, available price lists report may be reviewed
section. of suppliers where available may be used. In case similar and disclosed after
equipments have been purchased in recent past, current obtaining their
cost estimates may be based on past experience. consent for name and
2. Objects of the issue are construction of projects disclosure.
Appraisal reports should be reviewed and retained,
where possible, and the details of the costs are disclosed
in the Offer Document on the basis of the appraisal
report.
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review
3. Review the purpose for which In the absence of any appraisal reports or an independent 3. Separate certicates
funds are needed and the quantum consultants report related to the projects, the disclosures and quotations
of funds required for each purpose. in the Offer Documents are based on management from third parties as
estimates and bench marked with past experience if specied in the rst and
4. Examine the schedule of any. Suitable disclosures are to be included in the Offer
deployment of the funds proposed second columns (to the
Document to indicate that the projected costs are based extent possible). In
to be raised, as provided by the on management estimates and are subject to revisions,
Issuer and discuss the interim use case required, consent
including by way of risk factor. of such third parties to
of proceeds with the Issuer. Any denitive agreements entered into by the Issuer the disclosure of the
5. Various components of proposed should be reviewed and suitably disclosed in the Offer information in the Offer
expenditure in each of the objects Document. In the absence of any denitive agreements, Documents may also
of the issue are identied and the risk emanating therefrom is disclosed in the Offer obtained.
backed up by documentation from Document.
independent third parties such 3. Objects of the issue are funding the working capital 4. Site visits to
as suppliers, architects and CAs, requirements keyprojects proposed
any agreement or memorandum to be executed as per
Management certication of the Issuers projected the objects. However,
of understanding or management working capital requirements. Check the basis for
estimates, as the case may be. management estimation. Obtain CA certicate providing where the objects
working capital break up for last two years along with include setting up
relevant ratios. similar projects in
Where available banks assessment of working capital multiple location like
requirement may be reviewed and used for disclosure. retail stores, visit to key
Requirement for additional working capital should be locations where some
reviewed and utilisation of existing limits should be work has commenced
examined. is recommended.
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review
6. Expenditure already incurred 4. Objects of the issue is investment in a Subsidiary or a
on any object is backed up by Joint venture
certication from a CA. After determining whether the investment would be in
7. Means of nance is examined. In the form of debt or equity, any agreements and/ or other
the event that the objects are not documents already executed in relation to the investment
entirely funded through the issue should be reviewed (to determine, amongst other things,
and identiable internal accruals,
to conrm that at least 75% of the if any dividend are assured or special rights provided by
amount that is not being funded the Issuer) and disclosed in the Offer Document.
from the Issue and identiable The details of utilisation of funds in the subsidiary and
internal accruals is rmly tied JV should be examined and disclosed in the Offer
up through a loan or a sanction Document.
letter from a bank or a nancial 5.
institution. Objects of the issue is acquisition of a Subsidiary or a
Joint venture
8. Check if there are any existing /
anticipated material transactions in In the event that objects are used for acquisition of a
respect of use of Issue proceeds Subsidiary or investing in a business due to which the
with promoters / directors / key Issuer would become entitled to more than 50% the
managerial personnel (KMPs) / capital or prot and losses, then a report prepared
group companies / associates, and by a accountant (who shall be named in the Offer
review the disclosures in the Offer Document) on such Subsidiarys/ business prot and
Document. loss for the last 5 years and assets and liabilities for the
specied periods are obtained and disclosed in the Offer
Document as required under the ICDR Regulations.
6. Objects of the issue is brand building
This is primarily ba sed on management estimates.
However, in the event that such brand promotion is in
continuation of past practices followed by the Issuer, any
past agreements and historical expenditure should be
reviewed.
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9. If the funds proposed to be raised In the event that such brand promotion is to commence
under the issue shall be invested by utilisation of issue proceeds, any agreements entered
towards the stated objects through into for brand promotion with celebrities, advertising
a Subsidiary or Joint Venture of the agencies or other agencies should be reviewed to
Issuer, discuss the proposed form determine the estimated expenditure.
of investment in such Subsidiary 7. Objects of the issue is repayment or prepayment of
and the possible benets accruing loans
to the Issuer from the same and The loan documents pertaining to loans identied
review the other requirements for repayment/pre-payment should be reviewed. A
under the ICDR Regulations. certicate is provided by a CA and such certicate is
10. Review that general corporate relied upon for the outstanding amounts, utilisation of
purposes does not exceed 25% the loan amount and conrmation that the loan is being
of the total proceeds from the utilized for the purpose it was granted.
proposed issue, else a separate 8. Objects of the issue is to acquire identied land
risk factor shall be required.
Agreements/ MOU entered into with the seller should
11. In case the project has been be reviewed.
appraised, the appraisal report Title deeds of the land proposed to be acquired or title
forms the basis of disclosure. reports issued by a legal counsel should be reviewed.
Disclose if it is a related party transaction or a director
is interested.
Land use should be reviewed and where there is a
need to change the use of land the status of obtaining
the approval for such change must be reviewed and
disclosed.
Certication regarding amount, if any, paid towards the
acquisition is obtained from a chartered accountant/
statutory auditor.
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review
9. Objects of the issue is to acquire unidentied land or
undertake investments in unidentied companies
The requirements are based on management estimates,
which should be reviewed. Third party conrmations
should be obtained wherever possible. Such estimates,
where information is available, may be benchmarked with
the going rate at such localities based on independent
real estate consultant reports.
10. In case of Issues by banks and NBFCs where the objects
of the issue is to improve the Capital Adequacy Ratios/
Solvency Ratios so as to enable the bank/NBFC to grow
their lending business on the basis of improved ratios.
These requirements are based on calculations and
estimates prepared by the management. No documents
are reviewed as such for this purpose.
11. Other miscellaneous documentation
a. In cases where quotation from independent third
parties are not available due to the nature of the
object, internal management estimates are relied
upon, duly certied by an authorised signatory of the
Issuer.
b. Certication from a CA regarding any funds that
have been already deployed towards the objects
of the issue. The certicate should amongst other
things certify the source of funds which have already
been deployed in the project.
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c. Documents in support of rm arrangement of funds
through veriable means towards 75% of the funds
for project which are not being raised through Issue.
Such documents, which should be reviewed include:
(i) Final sanction letter issued by, or loan agreement
entered into with, a bank or a nancial institution.
(ii) In the event of inability of the Issuer to obtain rm
nancing from banks or nancial institutions,
legally enforceable undertaking/ guarantee from
the promoters of the Issuer to meet the funding
gap is obtained, along with certicates from a
CA certifying the measurable unencumbered
net worth of the promoters.
d. Appraisal Report prepared by Independent Agency
for the project (if any).
e. In relation to the schedule of implementation the
following should be reviewed, as applicable:
(i) Documents in respect of acquisition of land.
(ii) Architects certicate on civil works.
(iii) Plant Managers certicate on installation of
Plant & Machinery.
(iv) The estimated completion date is typically
based on management estimates.
Where a company or businesses is proposed to be
acquired through the Issue proceeds, the agreement
to acquire needs to be examined and key clauses
disclosed.
Check for any intentions to obtain bridge loans/
intermittent funding and disclose the same.
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4. INDUSTRY
Once the relevant industry sector of 1. Copy of relevant extract of the Industry report(s).
the Issuer is identied the following 2. Print out of the data taken from various websites.
diligence steps are typically undertaken:
3. Copy of relevant extract of the Industry journal, magazine,
1. A search is undertaken with the
newsletter.
help of the Issuer to identify all
the relevant sources from where 4. Consent from the publisher or copyright holder, as
factual and current information applicable, in case reproducing information from a source
relating to the industry including, requires the publishers consent.
demand and supply conditions,
global scenario, market trends, key
growth drivers, industry outlook
etc. can be extracted.
2. In a scenario where the Issuer is
proposing to invest the proceeds
of the issue in a new industry
vertical, the industry dynamics of
such sector are attempted to be
highlighted.
3. In case where the Issuer has
businesses across diversied
sectors, a brief overview is given
for each sector where the Issuer
has material operations.
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4. Thrust is laid on the information
available on the websites of
government bodies, independent
agencies, industry associations
etc. Additionally, sectorial reports
are also relied upon for sourcing
information subject to the terms
and conditions of the usage of the
report.
5. Latest publications of the industry
specic journal, magazine,
newsletter are also obtained from
the Issuer.
6. In case of sectors which are not
widely covered, reliance is placed
on the in-house research provided
by the Issuer.
7. Sometimes the Issuer also
engages organizations like
CRISIL to provide industry specic
reports for inclusion in the Offer
Document.
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review
5. BUSINESS
Due diligence of the business of the 1. List of project completion certicates, if any. Issuer website / lings with
Issuer requires understanding the 2. Issuer / Chartered Accountant certication on the order the Stock Exchanges in
various business segments in which book position. case of a listed Issuer.
the Issuer operates and review of the 3. Issuer certication of its total number of employees. Site visits to key installations
relevant information pertaining to the 4. Consent of the third party i.e. customer, supplier etc. for of the issuer.
operations of the Issuer. disclosure in the Offer Documents, if required.
1. Typically, a kick-off meeting is 5. List of material regional / branch ofces / manufacturing
units of the Issuer and its Subsidiaries.
organized wherein the Issuer
6. For real estate companies, an architects certicate
gives an overall perspective about pertaining to the land reserves/developable or saleable
among other things its business areas as required under the format prescribed by the
operations. The mission and SEBI in the erstwhile Annexure V of the SEBI standard
vision of the Issuer is shared. The observations and relevant documents to back-up the
business strategy, strengths and Annexure V disclosures.
the challenges faced by the Issuer 7. List of material products manufactured, supplied or sold
are discussed. by the Issuer.
8. CA/Auditor certication with respect to data/numbers/
2. Inspection of sample facilities factual points in the section on the basis of the MIS
of the Issuer, if possible, i.e. the maintained by the Issuer. Normally this will be covered
project site, factory location, in the comfort letter, if not in comfort letter, please also
registered/corporate ofce etc. obtain back-up/ Issuer conrmation, as appropriate.
may also be undertaken for better 9. Documents pertaining to the registered and/ or the
understanding of the business corporate ofces of the Issuer.
operations. 10. Board minutes and business plans, if any.
11. Key agreements in relation to the business of the Issuer.
24
review
3. Meetings are organized with 12. Material documents related to any grants or tax incentives
the key functional managerial received by the Issuer from any governmental authority
personnel to get an insight of the in respect of the Issuer.
product/service, the manufacturing 13. Schedule of insurance policies and review of insurance
process, capacity utilization, policies on a sample basis. Any directors and ofcers or
sourcing of raw material, selling key man insurance maintained by the Issuer.
and distribution, competition, 14. Review of all material documents relating to major
acquisitions or dispositions, or, proposed acquisitions or
market share etc. dispositions, by the Issuer.
4. Drafting sessions with the Issuers 15. Documents pertaining to all material trademarks, service
management are organized to marks, trade names, brands and copyrights of the Issuer
review the disclosure in the Offer and their date of application or registration, to the extent
Documents. applicable. In addition, a schedule of all trademarks,
service marks, trade names, brands and copyrights
5. Additionally, if considered should be provided by the Issuer for review.
necessary diligence calls are done 16. Sample product brochures, if available.
with major customers / suppliers to
17. Details of any agreement or arrangement (or any
understand if there are any major judgment or ruling) which restricts the Issuers ability to
concerns / risks. compete anywhere in the world and of any notication
or registration or notication under the relevant domestic
legislation.
18. Internal policy documents like risk management, HR, ISO
Manuals and corporate social responsibility policy, if any.
19. SHE Safety, Health & Environment policy, if any.
20. Any performance guarantees given by the Issuer.
21. Any export obligations of the Issuer.
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review
22. Certicates granted by the relevant authorities in
connection with the more important trademarks (such as
the name of the Issuer) and other intellectual property
documents material to the Issuers business.
23. Trade union or settlement agreements including past
disputes if any.
24. Documents on any collaborations, strategic partnership
or nancial assistance agreements, including share
purchase agreement with private equity.
6. HISTORY AND CERTAIN INCORPORATION MATTERS
Diligence is conducted by reviewing the 1. Certicate of incorporation and certicate of Website checks:
records of the Issuer (as mentioned in commencement of business of the Issuer, if applicable. (a) MCA website for
the adjoining column), and by engaging 2. Memorandum & Articles of Association of the Issuer. incorporation / change
in discussions with the promoters and 3. Filings done by the Issuer with the RoC/board approvals of name / registered
senior management of the Issuer and in respect of the last change in the Memorandum of address etc.
taking appropriate certicates from the Association, last change in registered ofce, change in (b) Internet search for
Issuer for the information or records, name, change in status, etc.
which may be not available but is past news articles
required to be disclosed. 4. Annual reports and previous offer documents, if featuring Issuer,
applicable in the last ve years holding company and
5. Scheme documents and nal High Court orders Subsidiary / Joint
in respect of the past mergers, amalgamations or Venture Companies
schemes of arrangements involving the Issuer, in the and questioning the
last ten years. Existing shareholders and Joint Venture Issuer on the search
agreements with respect to the Issuer, if any. results (if not already
6. Material business contracts (not being contracts entered disclosed);
in the ordinary course of business) during the last two
years, that are included in the material contracts section
of the Offer Document.
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review
7. Back up documents or management conrmation in (c) Review of other
respect of key events, awards, etc. websites and/ or
8. Conrmation/backup documents in respect of re- databases, such as
scheduling of borrowings of the Issuer, where applicable. those the Reserve
Bank of India and
9. Conrmations from the Issuer on any time/cost overruns registries covering
in setting up projects and any strikes, lock outs, etc. Indian companies
10. Certicates from each Subsidiary/ Joint Venture Issuer (such as www.
certifying its disclosures in the section. Copies of MoAs, watchoutinvestors.
AoAs and Annual Reports of all subsidiaries. com)
11. Extracts of statutory registers maintained by the Issuer. (d) Filings done with stock
12. Minutes of the meeting of the board (including exchange, if applicable
committees) and shareholders of material Subsidiaries. in the last ve years
In case of acquisition of any listed Issuer, compliance (e) Calls and meetings
with the takeover/insider regulations. with key suppliers
13. Documents relating to guarantees, if any, given to third and clients where
parties by the promoters offering their shares in the applicable.
proposed offer for sale.
7. MANAGEMENT
Due diligence of management requires 1. Certicates/self-attested CVs from Directors/KMPs for 1. Website checks
review of information pertaining to their prole, other directorships and other details. Stock Exchanges,
directors and KMPs from the records of RoC, or other
Issuer, undertakings obtained from such 2. Standard certicates providing declarations and websites covering
individuals and certain independent conrmations issued by directors and Form 32 for companies such as
checks as all the data required for the appointment of the current directors and for the watchoutinvestors.
disclosure in the Offer Document may com, news articles to
not be readily available with the Issuer. resignation of the directors who have resigned in the last
three years. the extent applicable
The identication of the KMPs is done and available.
by the Issuer.
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review
3. Board/Shareholders resolutions for appointment of 2. Notication to stock
the current directors, their term and remuneration; any exchanges of change in
service contracts or agreements with the directors, directors if applicable.
especially executive directors.
4. Issuer certicate for Management Organisation Structure.
5. Issuer certicate listing out KMPs. Typically every division
head such as head of operations, marketing, nance, etc
and above should at least be classied as KMPs.
6. Issuer certicate for remuneration paid to key managerial
personnel.
7. Issuer certicate for changes in directors and KMPs
along with reasons for change.
8. Certicate from the directors regarding current and past
directorship(s) in listed companies which have been
or were delisted or whose shares have been or were
suspended from being traded, if any, as required under
the ICDR Regulations.
9. Copies of documents relating to any arrangement or
understanding with major shareholders, customers,
suppliers or others, pursuant to which any of the directors
or key managerial personnel, was selected as a director
or member of senior management.
10. Corporate Governance Certicate from Statutory Auditor
/ Practicing Company Secretary.
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review
11. Certicate from Issuer on loans given to employees if
any/ any such policy.
12. Board minutes for last two years to identify interest of
directors or any rm or a company, in which director is
a member; in any property acquired by the Issuer within
last two years.
13. Related party transactions statement in nancial
statements and Register of Contracts under section 301
of Companies Act to identify overall interests of directors.
14. Register of Members or registrar statement to check for
shares held by Directors and KMPs.
15. Review of the board resolutions for any bonus/benet
sharing plan for the directors/KMP.
16. Minutes of various committees of the board, for last ve
years.
17. Service agreements with KMPs would need to be
reviewed on a sample basis. In most cases, the Issuer
would have a standard form of agreement it enters into
with its KMP with changes re salary, bonuses, etc.
18. Form 24AA for the other directorships of the current
directors.
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review
8. PROMOTERS, PROMOTER GROUP AND GROUP COMPANIES
Due diligence of promoters, promoter 1. Self certied declarations from the respective promoters for 1. Review of websites
group and Group Companies is the educational qualications, experience, shareholding, covering Indian
commenced through discussions with role in Issuer, other directorships, litigation and key companies (like
the Issuers ofcials to identify the identication documents and various other conrmations watchoutinvestors.
majority shareholders (individuals and required under the ICDR Regulations, based on which com, CIBIL, RBI,
corporate) and the key individuals disclosures are made in the Offer Document. SEBI, NSE and the
driving the business. 2. Certicates conrming the constitution of the promoter BSE), to determine any
1. The criteria for being identied group and the Group Companies; shareholding, board concerns regarding
as promoters are provided in the of directors of the corporate promoters and the Group the Promoters,
ICDR Regulations, which includes Companies, litigation, disassociation by the promoters in Group Companies
control either through shareholding the last 3 years and various other conrmations required and Promoter Group
or business involvement. under the ICDR Regulations, based on which disclosures entities.
are made in the Offer Document in relation to promoters, 2. Review of approvals
2. In addition to the above, the promoter group and Group Companies.
agreements and regulatory lings and application with
where promoters have been 3. Certicates from promoter group members for any other regulator
identied as such by the Issuer conrmations required under the ICDR Regulations, to identify promoters
in the past should be reviewed. based on which disclosures are made in the Offer mentioned therein and
Based on this review, whether any Document. for considering these
persons / entities 4. Non-compete agreement, if applicable. entities as promoter/
promoter group for the
5. Family settlement agreement, if any. issue.
6. MoA and AoA of the corporate promoters and Group
Companies.
7. Annual reports of the Promoters and the Group
Companies whose nancial information has been
disclosed in the offer document for the past 3 years.
30
review
identied as promoters in the past, 8. Agreements and regulatory lings where the promoters
should be considered as promoters have been identied as such by the Issuer in the past.
of the Issuer for the purposes 9. Agreements with large investors like private equity
of the issue in the context of the investors to ascertain control clauses for them to
denition in the ICDR Regulations. be included as promoter/promoter group or amend
3. Based on the identication of agreement to drop such clauses to exclude investors
promoters as detailed above, the from promoter/promoter group.
Issuer, based on the requirements
under ICDR Regulations explained
by the Lead Managers, identies
the following
Promoter
Promoter group
4. For individual promoters, the
requisite details in accordance with
the provision of ICDR Regulations
are sought, such as educational
qualications, experience, key
identication documents and
other directorships are provided
by the Issuer and certied by the
respective promoters.
5. For corporate promoters, details
such as their history, shareholding
pattern, board of directors and
change in control of the Promoter
company in the last three years
are sought through certicates. If
listed, additional disclosures
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review
(share price, promise vs.
performance etc.) are discussed.
If the promoters are corporate
entities, then the natural persons
in control of the corporate promoter
or persons who are on the board of
directors of the corporate promoter
of the Issuers promoter are
identied.
6. Certain details such as the nancial
information regarding the top 5
Group Companies (if listed, on
the basis of market capitalization
and if unlisted, on the basis of
turnover), loss-making Group
Companies, the negative net worth
Group Companies, defunct Group
Companies or Group Companies
under winding up are provided by
the respective Group Company
through the Issuer. The name and
type of organization; business of
the Group Company, the interest
of promoter of the Issuer in such
Group Company and various
conrmations that are required
under the ICDR Regulations are
provided for all Group Companies.
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review
7. Another aspect to be discussed
with the management of the Issuer
is the conict of interest/common
pursuit of the Issuer with any of
the Group Companies or entities in
which promoters are interested.
8. Lead Managers also discuss if
the promoters have disassociated
from any company in the last 3
years and reasons for the same
and obtain certications to this
effect.
9. Lead Managers also discuss the
nature and extent of the interest
of every promoter and Group
Company including in promotion
of the Issuer, in the land acquired
by the Issuer in the last two years
or in any transaction such as
acquisition of land, construction of
building or supply of machinery.
In addition, the Issuer conrms,
and provides details, if any,
regarding any payment of benets
to promoters or promoter group
during the last two years. Material
related party transactions between
the Issuer and the
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Group Companies are also
discussed with the Issuer and the
Lead Manager may request for
further details in this respect.
10. For disclosure relating to Group
Companies, certicates are
obtained from each Group
Company or the promoters.
9. FINANCIAL INFORMATION
For the Issuer: 1. Auditors report. If pro forma nancial
1. Auditors report on nancial 2. Peer review certicate of auditors and conrmation that statements are required to
statements as required under the the same is valid. be included, please note
ICDR regulations that there is no guidance
3. Management conrmations on certain issues. under Indian GAAP on the
2. Diligence sessions with 4. Auditors report on statement of tax benets. preparation of proformas.
Management and auditors Accordingly, the auditors
(statutory and internal) along 5. Comfort letters.
may need guidance from
with legal counsels to discuss 6. Review of minutes of audit committee / board / the Lead Manager and
any issues related to the nancial shareholders meeting for the last three years. international counsel on the
statements following:
3. For various matters such as Standards for
determining experience and proformas under IFRS,
independence of auditors, scope US GAAP etc.;
of audit, internal controls and Content of the
accounting policies, diligence calls examination report;
are done with the auditors and
Footnotes to the pro-
forma nancials.
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review
For Group Companies: 1. Issuer/ promoter to provide a list of all group companies.
Reliance on certicates from the 2. Promoters/ Issuers certication on top ve Group
promoters and the Group Companies Companies (based on market cap or turnover, as
whose nancials are disclosed in the applicable) and other companies for whom nancials
Offer Document need to be included (sick companies, negative networth,
companies under winding up petitions, loss making
Group Companies (for the last three years)). The
nancial information to be disclosed may be certied by
the relevant Group Company.
3. Last three year annual reports and incorporation documents
of top ve Group Companies (based on market cap or
turnover, as applicable) and other companies for whom
nancials need to be included (sick companies, negative
networth, companies under winding up petitions, loss making
Group Companies (for the last three years)), to be reviewed.
Managements Discussion and 1. Circle ups by statutory auditors forming part of the
Analysis of Financial Condition and comfort letter and management discussion/conrmation
Results of Operations: for gures for which circle-ups cannot be obtained.
Diligence sessions with Management 2. Annual reports, in the case of a listed Issuer.
and auditors along with legal counsels
to discuss the nancial statements
Financial Indebtedness: 1. Examine compliance under the loan agreements and
nancial covenants contained therein.
A schedule of outstanding nancial
2. Issue related consent from the lenders, if required.
indebtedness is prepared by the Issuer
and such schedule together with the 3. Copies of loan agreements, sanction letters, waiver
letters, security documents, documents related to bonds
supporting documents is reviewed. issued and outstanding.
4. Register of charges
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review
Other 1. Where the Objects of the Issue is an identied acquisition,
last ve years nancial statements of the company/
business being acquired along with the impact on the
issuer
2. Auditors to circle up all nancial information in the offer
document to conrm its accuracy and ensure that they
are based out of audited nancials.
10. LITIGATION
Diligence process in respect of litigation 1. MIS / summarized table of legal cases involving the In respect of diligence for
is undertaken by the Lead Managers Issuer to be provided by the Issuer and certied by legal litigation, there is little scope
with the assistance of legal counsels. head or any senior management personnel. for external review. The
The due diligence process followed with 2. Certications provided by the promoters, Directors, starting point of diligence
respect to litigation varies according to Issuer, Group Companies, Subsidiaries and Joint is the MIS/summarized
the parties with respect to whom the Ventures (if the litigation involving the Joint Venture is information provided by the
litigation is to be disclosed in the Offer material) in respect of the litigations. Issuer which is followed
Document. The various due diligence 3. Extract of last orders etc. of material litigation against by due diligence of legal
approaches adopted are as follows: the Issuer, Subsidiaries, JV and other cases which could documents provided by the
1. Litigation involving the Issuer and have a materially adverse effect on the position of the Issuer in the data room.
its Subsidiaries Issuer are to be reviewed.
Diligence process commences
with a meeting with Issuers
or its Subsidiaries ofcials
responsible for legal matters
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A checklist of legal information 4. Case papers of all the litigations (including past penalties)
as required in accordance relating to the Issuer and Subsidiaries as required to be
with ICDR Regulations is disclosed under the ICDR Regulations and provided by
shared with the Issuer and the the Issuer in the data room.
Issuer is required to provide 5. In cases where a materiality threshold is established
an internal management above which all litigations are individually disclosed,
information statement case papers of all such litigations above the materiality
(MIS) / summarized table thresholds should be reviewed.
of all the cases under various 6. In respect of a large number of similar cases which are
categorizations such as: combined for disclosure purpose, case papers for some
(a) Litigations by and against the litigation should be reviewed on a sample basis.
Issuer and its Subsidiaries.
(b) Categorisation by type of
litigation such as criminal,
civil, consumer, tax, trade
mark disputes, legal notices
issued to the Issuer and
arbitration proceedings. This
is not an exhaustive list and
can vary from company to
company, industry to industry
and geographic location of the
projects.
(c) Litigation involving any other
company whose outcome
could have a material adverse
effect on the Issuer.
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review
MIS / summarized table
produced by the Issuer is
examined, the litigation which
could materially and adversely
affect the Issuer are identied
and then a due diligence of the
case papers relating to such
identied litigation is carried
out. In the event documents
relating to any litigation are
in vernacular language, the
Issuer also provides either the
translated copies of review or
in case the translated papers
are not available, summary
of the matter prepared by
the local lawyer handling the
matter.
If required, meetings /
conference calls are also
held with the respective legal
counsels /in-house counsels
of the Issuer who are handling
these cases.
Depending on the size of
the Issuer and the number
of litigation, a materiality
threshold / cut off may be xed
and all the litigation
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proceedings above such
threshold are disclosed
separately and the remaining
litigation matters which
are of a similar nature and
individually do not impose
material nancial and other
liability on the Issuer are
combined for the purposes
of disclosure. The case
papers of the litigation that
are combined together are
veried on a sample basis.
The litigation section so
drafted is reviewed by the
Issuers ofcials in charge of
legal function and a drafting
session is conducted whereby
discussions are held and the
disclosures are nalized.
2. Litigation involving the promoters
of the Issuer
A checklist of legal information
as required in accordance
with ICDR Regulations is
shared with the Issuer and the
Issuer is required to provide
the details of, and documents
pertaining to, all the litigation
involving the promoters.
39
review
The summary table provided
by the Issuer is reviewed by
the legal counsels and further
requirements, such as queries
or documents, are provided to
the Issuer.
Based on the list of litigation
and certications provided,
the disclosures for the Offer
Document are drafted.
The disclosures are nalised
after discussions with the
relevant ofcials of the
promoters or the Issuer, as
the case may be.
3. Litigation involving the Directors of
the Issuer
Certication on disclosures
is obtained from each of the
Directors. Subsequent to
review of the disclosures in
the certicate, any further
explanations and details
required are obtained from
each of the Directors for
the disclosures in the Offer
Document.
40
review
4. Litigation involving the Group
Companies of the Issuer
Certication on disclosures
is obtained from each of
the Group Companies.
Subsequent to review of the
disclosures in the certicate,
any further explanations and
details required are obtained
from each of the Directors for
the disclosures in the Offer
Document.
5. The disclosures as nalized are
certied by the relevant company
on their respective letterheads
and they provide an undertaking
to update any further updates to
the Lead Managers till the listing
of the shares. The Issuer should
immediately inform the Lead
Managers about any development
on any disclosed litigation matter
or any new litigation.
41
review
11. GOVERNMENT APPROVALS
1. Diligence is started by way of 1. Approvals for running the business of the Issuer which
discussions with the management are material in respect of the business of the Issuer.
of the Issuer and legal counsels to Typically these are approvals material for the functioning
understand the various approvals of the Issuer and carrying out its business activities.
which are required by the Issuer 2. Corporate Approvals and Registrations related to
under various laws to run its the Issuer such as Certicate of Incorporation, PAN
business, including necessary No. Service Tax Registration, Sales Tax & Excise
approvals related to new projects Registrations, etc.
being set up as stated in objects of
the issue section. 3. Various statutory and government approvals for the
branches / facilities / ofces of the Issuer on a sample basis,
2. All material government approvals such as approvals under local Shops and Establishments
are provided and reviewed. The Acts, Standards of Weights and Measures Act, approvals
Issuer is also required to provide of Electricity Boards, environmental approvals etc. (this
copies of approvals that are not list is not exhaustive and varies according to the states in
material on sample basis, for its which the Issuer operates).
branch, plant, location or ofce, as
applicable. 4. Approvals required for implementing the projects for
which funds are being raised as per the Objects including
3. The Lead Managers with the status of those in the process of being obtained.
help of legal counsel review such
approvals and check their validity.
For expired approvals, the Issuer
is required to make applications
for renewals and if the renewed
approval is not received by the
ling of the DRHP, then appropriate
disclosure is made in this section
and the section on risk factors. In
the event documents relating
42
review
to any approval are in vernacular
language, the Issuer also
provides the translated copies
for review. Approvals required
with respect to projects, including
those undertaken by the Issuers
Subsidiaries, for which funds are
proposed to be raised are usually
disclosed project wise. If any critical
approval has been applied for but
not obtained or a material approval
has not been applied for (due to
reasons such as the ling of the
application being contingent on the
completion of certain milestones),
then necessary disclosures are
made in this respect.
12. BASIS OF ALLOTMENT
Manner of diligence Documents to be reviewed and Basis of Due Diligence External/other review
Diligence comprises of supervision of Before Allotment On a case to case basis
intermediaries, including the RTI and 1. Pre issue advertisement after registering the RHP with engaging external rms to
Bankers to the issue and independently registrar of companies. review work carried out by
checking/verifying on a sample basis the RTI. The work carried
the allotment les, rejection, collection 2. Pricing resolution and pricing advertisement. out by these agencies
and refunds. 3 Consolidated bid le (NSE and BSE) from the RTI, one includes providing a post-
day after issue closure after the corrections allowed have issue report which includes
been carried out. review of technical rejection
4. List of employees (in case of allocation to employees). cases, reconciliation of total
collection, refunds as well
as records of share credits.
43
review
5. Proposed Allotment File from the RTI, along with reports
giving details of technical rejection cases, including:
same beneciary account,
applicants with same PAN,
applicants without PAN.
6. Copies of all Provisional Certicates and Final Certicates
from the Bankers to the Issue and the SCSBs.
7. Allotment File (actually used for allotment and credit of
shares. Registrar to provide updated le with revisions if
any, with reasons).
8. Rejection File containing details of the applicants denied
allotment with reasons thereof.
9. Meeting with the registrar to draw out the basis of
allotment, discussion and documentation of procedures
followed by the RTI, allotment, rejections, special cases,
if any and other related matters.
10. Basis of allotment giving the allotment details in various
categories including QIB, HNI, retail, employee etc.
11. Sample check of the allotment and rejection le and
reconciling the basis of allotment with the funds and
applications received.
12. Letter from RTI addressed to Lead Managers regarding
the details they have veried with the depositories (NSDL/
CDSL) pursuant to SEBI letter dated June 12, 2007.
13. Review of demographic details downloaded from
depositories.
44
review
14. Copy of Certicate from the RTI about the validation of
the electronic bid details with the depositorys records for
DP ID, client ID and PAN.
15. Final minutes submitted to DSE along with the basis of
allotment to be nalized along with the designated Stock
Exchange.
16. Management and auditors discussion and certications
for any material developments post RHP & post the
Prospectus.
Post Allotment
17. Copy of basis of allotment advertisement.
18. Issuer Board/ Committee resolution for allotment of
shares.
19. Refund File.
20. Certicate from RTI for credit of securities and dispatch of
refunds within the specied time period.
21. Certicate from depositories for credit of securities and
lock-in of securities.
22. Format of CAN and conrmation of dispatch of CAN.
23. Format of ECS intimation/refund orders.
24. Certicate from statutory auditors/practicing chartered
accountant/ practicing company secretary stating that
allotment has been made as per the basis of allotment
approved by the Designated Stock Exchange and lock-in
of pre issue share capital for 1/3 years.
45
review
25. Certicate from statutory auditors/practicing chartered
accountant/ practicing company secretary stating that
allotment of shares from the employees quota has been
made to permanent/regular employees of the company
and of the promoter companies, as on the date of the
opening of the public issue and who are entitled to such
allotment.
26. Distribution schedule.
27. Shareholding pattern of the Issuer pre-issue, for the
Issue and post allotment.
28. Return refunds through ECS/physical mode and steps
taken by Registrar to address the same.
29. Transfer instructions for transfer of funds from Escrow
Account/SCSB to Public Issue account and refund
account.
30. Transfer instructions for transfer of funds from the Public
Issue account to Issuer account.
31. Periodic updates on nature and status of investor
grievances.
Post-issue monitoring reports
32. Initial post-issue monitoring report (3-day report) from
RTI.
33. Final post-issue monitoring report from RTI.
34. Certicate from refund banker(s) that the amount due
from the Issuer to investors is deposited in a separate
account giving details of the total amount deposited in the
account and date of deposit.
46
review
13. ANCHOR PORTION
1. Format of Anchor application form.
2. Format of Anchor CAN.
3. Anchor application forms received in the issue.
4. Minutes of anchor allocation/ note with anchor allocation
rationale.
5. Anchor CAN sent to investors.
6. Board resolution for anchor allocation.
7. Anchor allocation intimation to BSE.
8. Anchor allocation intimation to NSE.
9. Anchor allocation intimation to SEBI.
10. Final certicate received from Escrow Collection Bank.
47
ANNEXURE B
INDICATIVE RETENTION LIST OF INFORMATION/DOCUMENTS

IN A PUBLIC OFFERING
The following list sets out certain information/documents which can be considered for
retention in relation to a public offering (Issue). This list is purely illustrative and does
not attempt to indicate industry, sector or transaction specic information and documents.
Accordingly, this list may require modications based on specic transaction requirements.
Please note that in this Checklist:
(a) Issuer means issuer company;
(b) Subsidiaries and Joint Venture means the subsidiaries and joint ventures of the
Issuer;
(c) Promoter and Promoter Group has such meaning as provided in the ICDR
Regulations;
(d) Group Companies means companies, rms, ventures, etc promoted by the
promoters of the Issuer, irrespective of whether these are covered under Section 370
(1B) of the Companies Act, 1956 (Companies Act); and
(e) Offer Documents means collectively the relevant offer documents including the
Draft Red Herring Prospectus (DRHP)/ Draft Letter of Offer (DLOF), the Red
Herring Prospectus (RHP) and the Prospectus/ Letter of Offer (LOF).
S. Name of Information/Documents
No.
Corporate and statutory documents
1. Copies of Memorandum of Association (MoA), the Articles of Association (AoA),
Certicate of Incorporation (and for change in name, if any) and Certicate of Commencement
of Business of the Issuer and its material subsidiaries.
2. Copies of the annual reports for the past ve years of the Issuer and its material subsidiaries.
Issue-related corporate, regulatory and stock-exchange approvals and correspondence
3. Certied true copy of the extract of the resolution of the Board of Directors and shareholders
resolution authorizing the Issue under Section 81(1A) of the Companies Act.
4. For eligibility requirements under Regulation 26(1) of the SEBI (ICDR) Regulation, where
applicable:
Where the Issuer holds more than 50% of its net tangible assets as monetary assets,
then an undertaking from the Issuer, and/ or any agreements, regarding utilization of
such monetary assets in business or project.
Fresh certicate of incorporation, wherever applicable.
CA certicate for nancial eligibility criteria (specied under Regulation 26(1)) based on
standalone and consolidated accounts.
IPO Grading Report, at RHP ling.
48
No.
5. Certied true copy of the approval of the Board or Committee resolution approving each of
the Offer Documents to be led with SEBI and the RoC, as appropriate.
6. Copies of other regulatory applications and the related approvals including approvals from
the Foreign Investment Promotion Board, RBI, if any and other regulatory authorities.
7. Copies of correspondence with SEBI, the stock exchanges and other regulatory bodies with
respect to the proposed public issue by the Issuer, including copies of the interim and nal
observations from SEBI and the responses to these observations.
8. Copies of cover letter for applications for and copies of in-principle approval received from
each of the stock exchanges on which the equity shares are proposed to be listed.
9. Copies of nal listing and trading approvals received from each of the stock exchanges on
which the equity shares are proposed to be listed.
Issue-related agreements, certicates, letters
10. Agreements relating to the Issue:
(i) Copy of agreements between the Issuer, the depositories, i.e., NSDL and CDSL and
the Registrar;
(ii) Copy of the Issue Agreement between the Issuer and the Book Running Lead Managers
(BRLMs) and selling shareholders (if any);
(iii) Copy of the Agreement between the Issuer and the Registrar to the Issue and selling
shareholders, (if any);
(iv) Copy of the escrow agreement between the Issuer, the BRLMs, the Syndicate
members, the Registrar to the Issue and the Escrow Collection Banks;
(v) Copy of the syndicate agreement between the BRLMs, the syndicate members, the
Issuer, and selling shareholders, (if any);
(vi) Copy of the underwriting agreement between the Issuer, the underwriters and selling
shareholders, (if any);
(vii) Copy of stabilization agreement (if applicable) between the Issuer, Green Shoe Lender
and Stabilization Agent; and
(viii) Copy of agreement between the Issuer and the advertising/media & PR agency.
11. Executed set of standard certicates received by BRLMs from the Issuer, its directors, its
subsidiaries, promoters, promoter group and group companies and selling shareholders, as
applicable, at various stages of the Issue.
12. Engagement letters appointing the BRLMs;
Arrangement letter, if any, between the BRLMs and the auditors;
Relevant certicates from selling shareholders;
Copies of consent letters from directors, BRLMs, Bankers to the Issuer, Legal Counsels,
Auditors, Registrar to the Issue, Escrow Bankers, and experts to the Issue and selling
shareholders and appraising agency, if any;
Filing certicates and legal opinion of the domestic counsel/(s) and international counsel/
(s) to the transaction, as applicable.
Consent letters from lenders, as applicable, to the Issue in respect of the Issue.
Third party consents (publishers of industry reports, key customers etc) utilized for the
purpose of any disclosures in the offer documents.
49
No.
13. Certicate in relation to complaints/comments received on the DRHP within 21 days from
the date of ling the DRHP.
14. Compliance certicate for the period between date of ling DRHP and date of closure of the
issue in respect of news reports about the Issuer.
15. Credit rating, if any, obtained during the last three years by the Issuer, including rationale.
16. Relevant documents in relation to selection of the anchor investors in an issue.
Offer Document Disclosures
17. Certicates conrming the following:
Conrmation that the Issuer, its directors, Subsidiaries, promoters, promoter group,
entities with which Issuers directors are associated as directors and persons in control
of promoters have not been prohibited from accessing or operating in the capital market
or dealing in securities under any Order or direction passed by SEBI.
Details of current and past directorship(s) of the Directors, during the last ve years
preceding the date of ling of the DRHP with SEBI, in listed companies whose shares
have been or were suspended from being traded on the BSE or NSE.
Details of current and past directorship(s) of the Directors, in listed companies which
have been or were delisted from the stock exchange(s).
18. Objects of the Issue:
With respect to each object/ project, back-up documents from the Issuer, for requirements
of funds and means of nance with year-wise breakup of utilization, if applicable. Further,
back-up documents for means and sources of nancing of funds already deployed i.e.
whether through internal accruals, etc.
Appraisal report by independent agency, in case of appraised projects.
Conrmation from the Issuer that rm arrangements of nance (loan agreements or nal
sanction letters) through veriable means towards 75% of the stated means of nance
excluding the amount to be raised through the proposed Issue have been made.
Certicate from a Chartered Accountant with respect to deployment of funds that has
already been made by the Issuer in a project for which funds are being raised in the
IPO. The certicate should amongst other things certify the source of funds which have
already been deployed in the project.
For repayment or prepayment of loans: Certicate/conrmation from a CA for outstanding
amounts, utilization of the loan amount and conrmation that the loan was utilized for the
purpose it was granted.
In case objects of the issue is to acquire land: Certication regarding amount, if any, paid
towards acquisition is obtained from a Chartered Accountants/Statutory Auditors.
In cases where quotation from independent third parties are not available due to the
nature of the object, internal management estimates are relied upon, duly certied by an
authorised signatory of the Issuer.
50
No.
19. Capital Structure:
Certicate from the Issuer on the average cost of acquisition of equity shares held by the
promoter.
Undertaking from the promoters regarding promoters contribution and lock-in. If
applicable, review of documents regarding arrangements that have been made to ensure
that the equity shares included in the promoters contribution are subscribed for atleast
one day prior to the Bid/Issue Opening Date. This may include CA certicate regarding
promoters contribution in escrow account, if applicable.
Final scheme of arrangement along with court order pursuant to which shares have been
allotted.
In an offer for sale, conrmations from the selling shareholders regarding the eligibility of
the sale of offer for sale shares.
CA certicate for revaluation of assets and ESOP scheme compliance.
Certication in relation to shares exempted from lock in (like the shares held by FVCI)
and on the issuers intention/consideration to alter capital structure for a period of six
months after issue opening date.
Undertaking from promoters, promoter group not to subscribe under the issue.
20. Promoter and Promoter Group:
Standard certicates from Promoters and Promoter Group.
Certicate from the Issuer for identication of the promoters, promoter group and group
companies.
Copies of relevant documents in relation to any action initiated by any regulatory authority
(such as the RBI or SEBI) against the Promoter and any Promoter group or group
company. Consent letter from the promoter/(s) for the lock-in of promoters contribution
and pre-Issue shareholding for specied mandatory periods.
21. Business-related:
Industry data and/or reports for Business and Industry related information disclosed
in the offer document (includes relevant extract of the industry report, data taken from
various websites, extract of industry journal, magazine, newsletter, consent of publisher,
copyright holder in case reproducing information from source requires consent)
List of material business agreements of the Issuer and material subsidiaries, where
applicable;
List for major suppliers, vendors, customers of the Issuer and material subsidiaries, as
applicable;
List for major properties of the Issuer, such as branches, ofces, manufacturing plants,
operating centres etc;
List of major intellectual property owned or licensed by the Issuer and the material
subsidiaries;
List of insurance policies and any directors and ofcers or key man insurance maintained
by the Issuer ;
Order book position of the Issuer;
51
No.
Report of experts, where relevant;
Issuer certication on total number of employees;
CA, Auditor certication with respect to data/numbers/factual points in the section on the
basis of the internal accounting records maintained by the Issuer. Usually this will be in
the comfort letter, if not, please also obtain back-up/Issuer conrmation, as appropriate;
Copies of industry specic certicates and reports.
22. History and Certain Corporate Matters:
Certicate by the Issuer for the major events and milestones in the history of the Issuer;
Copies of documents for any awards, recognitions and quality standard certications
received by the Issuer and disclosed in the Offer Document; and
List of material shareholders arrangements, joint venture agreements of the Issuer and
material subsidiaries, as applicable.
23. Management:
Certied true copy of resolutions of the Board and shareholders, and Form 32 for the
appointment of current directors.
Back-up for brief proles, other directorships and details of directors and key managerial
personnel (KMP) (such as certicates, self attested CVs).
Back-up documents for the remuneration of the directors and KMPs as well as the terms
and conditions of their appointment.
Corporate governance certicate from the statutory auditor/practicing company secretary.
Certicate from Issuer on loans given to employees if any such policy.
Issuer certicate for management organization structure.
Issuer certicate for changes in directors and KMPs in the last three years.
24. Approvals and Licenses:
List of all material approvals, licenses obtained and applications made, including applications
for renewal.
25. Outstanding Litigation:
MIS of all material litigation pending, above the agreed thresholds, by and against the
Issuer (including each of its subsidiaries) which includes names of the parties, the value
of the claim, where applicable a brief description of the nature of the claim and the
status of the proceedings, should be maintained, certied by the legal head or senior
management personnel.
MIS and copies of relevant documents of any regulatory action (current or in past) taken
by the RBI/ SEBI/ stock exchanges or any other regulator against the Issuer.
MIS of pending proceedings, defaults, etc. in respect of companies/rms/ventures with
which the Promoters were associated in the past but are no longer associated in case
their name(s) continues to be associated with such proceedings.
Please note that relevant back-up documents with respect to any securities litigation, in
particular any litigation initiated by SEBI against the Issuer, Director, Promoters or Group
companies should be reviewed and maintained.
52
No.
26. Indebtedness:
Management conrmation regarding compliance under the loan agreements and
nancial covenants contained therein.
Auditor deliverables
27. Comfort letters issued by the auditors at the DRHP, RHP and Prospectus stage (including
the bring down comfort letter on allotment of the shares).
28. Signed copy of the audit report along with the nancial statements and annexures for the
relevant nancial years.
29. Signed copy of the Statement of Tax Benets.
30. Certication of accounting related disclosures in the Offer Documents like differences in
IFRS and IGAAP.
Records of calls/meeting minutes
31. Calls, meetings involving the Management and the transaction team:
Response of the Issuer to all due diligence checklists circulated by the counsels, where
practicable, and details of the independent diligence checks undertaken by the Lead
Managers.
Details of travel to the Issuers ofces and minutes, records of kick-off meetings, drafting
sessions, diligence meetings as well as for site visits to manufacturing plants or operating
centres.
Minutes of auditor diligence calls at various stages of the transaction, including
maintaining records of due diligence questionnaire, checklists and responses.
53
No.
32. Post-issue related documents:
Certied true copy of Board/ Committee resolutions for pricing and allotment of shares.
Copy of pricing / basis of allotment advertisement.
Copies of Provisional Certicates and Final Certicates from the bankers to the Issue
and the SCSBs, as applicable.
Allotment File (actually used for allotment and credit of shares. Registrar will provide
updated le with revisions if any).
Basis of allotment giving the allotment details in various categories including QIB, HNI,
retail, employee etc.
Minutes of discussions while nalizing the Basis of allotment.
Letter from RTA addressed to Lead Managers regarding the details they have veried
with the depositories (NSDL/ CDSL) pursuant to SEBI letter dated June 12, 2007.
Certicate from RTA for credit of securities and dispatch of refunds within the specied
time period.
Copy of visit report with RTA.
Certicate from depositories for credit of securities and lock-in of securities.
Certicate from statutory auditors/practicing chartered accountant/ practicing company
secretary stating that allotment has been made as per the basis of allotment approved
by the Designated Stock Exchange and lock-in of pre-issue share capital for 1/3 years.
Initial post-issue report (3-day report) and the Final post-issue report.
Copies of statutory advertisements issued at Filing of DRHP, Pre-issue advertisement,
Issue Opening, Basis of Allotment, announcement of Price Band and Pricing
54
About AIBI
AIBI is a voluntary associaon of Investment Bankers in the country. It was formed in 1990s at the
iniave of Indian Capital Markets regulatory body, SEBI. All Merchant Bankers, registered with
SEBI are eligible to be members of AIBI. AIBI is Indias only associaon represenng the investment
banking industry.
On January 21, 2012 the name of the Associaon was changed to Associaon of Investment
Bankers of Indiato encompass all the acvies carried out by the Investment Bankers other than
Issue Management.
Currently, there are y nine members of the associaon.
AIBI-in a new direcon:
AIBI is now reinvenng itself. AIBI strives to be an objecve Industry body with a credible acon
plan. AIBI balances its role as an industry body with its role of an inuencer so that there is never
any conict of interest for the members and ensure that its acvies are not conned to selected
few but are available and are benecial to all members.
AIBI is represented, through its Chairman, on SEBIs Primary Market Advisory Commiee, a forum
that provides an opportunity to present the industrys viewpoint on various issues. In the last one
year AIBI has made signicant strides in enhancing its capabilies. We have been working closely
with SEBI in the recent mes in improving the eciencies of the Indian Capital Markets.
AIBI has a dedicated website (www.aibi.org.in) ,and plans to make this website content rich to
showcase our industry
55

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Only for Limited Circulation to the Members of AIBI

ASSOCIATION OF INVESTMENT BANKERS OF INDIA

505 506, Dalamal Chambers, 5th Floor,

With best regards

Annexure A List Of Documents For Review In A Public Offering 10

1. Issue Related Information 10

3. Objects Of The Issue 16

6. History And Certain Incorporation Matters 26

8. Promoters, Promoter Group And Group Companies 30

11. Government Approvals 42

12. Basis of Allotment 43

13. Anchor Portion 47

Annexure B Indicative Retention List Of Information/Documents In A 48

Document. A review and examination of such documents provided by an Issuer,

his suspicion or ought to excite his suspicion as a professional man of reasonable

sufcient access to relevant records and personnel to complete an adequate and

LIST OF DOCUMENTS FOR REVIEW IN A PUBLIC OFFERING

INDICATIVE RETENTION LIST OF INFORMATION/DOCUMENTS

Currently, there are y nine members of the associaon.

AIBI-in a new direcon:

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