Institutional Trading Platform

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Information about Institutional Trading Platform

Published on October 29, 2018

Author: shubhamsoni8

Source: slideshare.net

1. INSTITUTIONAL TRADING PLATFORM FOR FMR II PAPER | SEMERSTER IX | OCTOBER 29, 2018 A L O O K A T BY SHUBHAM SONI | SHHUBH2@GMAIL.COM

2. INTRODUCTION Listing without Red Tape... A new window on stock exchanges where e-commerce, data analytics, bio-technology, and other startups can list and trade on their shares. Relaxed standards for listing on stock exchanges. Why Important? Attract exciting new-age companies in India which skip domestic listing and go overseas,  The bottom line If it takes off, the ITP will give Indian promoters and private equity investors an easy exit from startups. FMR 2 | October 29, 2018

3. BACKGROUND Put in place vide amendments to the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 (“ICDR Regulations”) on August 14, 2015 Framework has been retained in the ICDR Regulations, 2018 ITP is specified under chapter X of the SEBI ICDR Regulations, 2018, which is named as‘InstitutionalTrading Platform’. Not accessible to retail individual investors. FMR 2 | October 29, 2018

4. ELIGIBILITY SME or Startup a public company and who does not have any securities listed on any of the recognised stock exchanges in India. Regulatory criteria – The company, board of directors and promoters of the company is not a wilful defaulter.  Financial criteria – The revenues of the company does not exceed 100 cr. in any of the previous financial years, or paid up capital of the company is not more than 25 cr. Past funding criteria – The company has received investment of atleast 50 lakh rupees in equity shares from outside sources Exchange-based criteria & Other Criteria like age (Max 10 Yrs.) FMR 2 | October 29, 2018

5. LISTING How to list specified securities? Apply to the ITP in a specified format accompanied by other specified documents. The draft and the final disclosure documents need to be approved by the board of directors and must be signed by the Managing Director and the Chief Finance Officer. The disclosures will be published in the website of the stock exchange for a period of atleast 21 days. The stock exchange may grant in-principle approval to such listing.  Once the approval is granted by the ITP, the company and the ITP will enter into a listing agreement. The listed companies must compulsorily sign with both the central depositories. FMR 2 | October 29, 2018

6. CONDITIONS For raising capital, Once listed in the ITP, can't issue securities to the public in any manner nor can it call for an initial public offering (IPO). The company is permitted to raise capital through private placements or rights issue.  The securities will be transacted only in dematerialised format and minimum trading lot on ITP will be 10 lakh rupees and have a tick size of one rupee. The promoters of the company must hold not less than 20 percent of the post listing capital and such stake holdings of the promoters cannot be diluted (locked-in) for a period of three years from the date of listing. FMR 2 | October 29, 2018

7. EXIT Once listed in the ITP, can't issue securities to the public in any manner nor can it call for an initial public offering (IPO). The company is permitted to raise capital through private placements or rights issue.  The securities will be transacted only in dematerialised format and minimum trading lot on ITP will be 10 lakh rupees and have a tick size of one rupee. The promoters of the company must hold not less than 20 percent of the post listing capital and such stake holdings of the promoters cannot be diluted (locked-in) for a period of three years from the date of listing. FMR 2 | October 29, 2018

8. THANK YOU! FMR 2 | October 29, 2018

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