Growing companies would often seek ways to attract investors and raise capital, listing on a stock exchange is the possible option for this purpose. To become publicly traded a company has to live by the rules and regulations set up by the market regulator Sebi. When a company gets listed and issues shares for the first time, it is done through the primary market. Whereas the secondary market controls the price of shares, this is the place where buying and selling of existing stock takes place. For entering primary markets, companies need advisory services for managing issue and compliance with the regulations of Sebi and the exchange where filing for listing. Mainly, there are 3 modes of entering the primary stock market which as follows: |
Initial Public offerings: A company may issue securities through public offer (prospectus), through private placement, and through rights issue or bonus issue. The company offers its shares with help of merchant banks and after IPO these shares are traded in the secondary market by the investors. The issuer can hire one or more merchant banker in Delhi to manage the issue and underwriting support.
SME Listing: BSE and NSE are leading stock exchanges of India with a nationwide presence, both offer trading platforms for SMEs through relaxed listed norms. Listing is possible without IPO and offer document is filed with stock exchange for vetting. However, underwriting of the issue is mandatory for which merchant bank is hired which also functions for preparing of application for listing and filing of the offer document.
Direct listing: This option is for already listed companies, its virtue has increased with derecognition of most regional exchanges by Sebi. The board has set new trading norms for RSEs following which majority of them have opted for an exit. The RSE listed companies have the option to provide an exit route to investors or seek a direct listing on any of the national exchanges. For direct listing, the respective norms set by stock exchanges (BSE, NSE, and MSEI) are applicable for public issue of shares.
CCV helps companies entering the primary stock market through IPO, Direct listing, or SME listing. CCV is Category I merchant banker located in New Delhi providing services to corporate clients. With a qualified team, it is active in all fields of service and vast experience of handling complex legal and financial matters. In addition, CCV also provides ESOP valuation certificate to all types of companies.
Conclusion: To fuel the capital requirements for growth investor attention is possible through entry on stock exchange.
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