Revision of the chapter is essential, focusing on the issues of shares and lock-in periods, with details on public offers, subscriptions, rights issues, share allotment, and the role of underwriters in ensuring subscription for a public issue. Various statutory provisions, including SEBI requirements, the minimum subscription rate, and the refund policy for unmet minimum subscription levels, are explained in detail to ensure compliance with regulations and a smooth public issue process.
Insights
Different methods, such as fixed price and book building, are utilized for public offers of shares, with varying lock-in periods for different types of shares, emphasizing the importance of understanding these mechanisms for investors and companies alike.
The process of share allotment is highly regulated, involving specific timelines, minimum subscription requirements, and the role of underwriters to ensure compliance with SEBI regulations, underlining the meticulous steps and oversight necessary for a successful public share offering.
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Recent questions
What is the purpose of a lock-in period?
A lock-in period restricts the sale of shares.
What is the difference between IPO and FPO?
IPO is the initial public offer, while FPO is a follow-on public offer.
What is the purpose of a red herring prospectus?
A red herring prospectus sets a price range for bidding.
What is the significance of a rights issue?
Rights issues offer existing shareholders the first option to buy new shares.
What is the role of underwriters in a public issue?
Underwriters ensure subscription for shares in exchange for a commission.