A study of primary markets in India
- Company profile
- An overview of the company
- History of the company
- Project overview
- Objectives of the project
- Methodology of the project
- Primary market
- Initial public offering
- Eligibility norms for making the issues
- Steps involved in floating a public issue
- Book building process
- Listing of securities
- Guide to investors
The financial assets comprises of banking Accounts, pension funds, Provident fund, Mutual fund, shares, debentures and other securities. A capital market deals in financial assets, excluding coin & Currency. Capital market is a medium for mobilizing the finance out of the savings of the community and making it available to the users. I.e. to industry, trade, commerce for liquid financial instruments etc. Capital market deals in securities issued by corporate Government & other industrial enterprises.
The Indian Capital market has three components.
1. Money Market
2. Primary Market
3. Secondary Market
Primary market refers to the market of new issues or market for mobilization of resources by the companies and Government undertakings, for new projects and also for expansion, mobilization, addition, and diversification and up gradation.
Primary market operations include new issue of shares by new and existing companies, further and right issues to existing shareholders, public offers, bonds etc.
Primary markets are the medium for floating public issues. Public issue means an invitation by a company to the public to subscribe to the securities offered through a prospectus. Similarly the primary market infuses new listed securities in the market generated through new public issues floated regularly and thus enlarges the security base traded in the secondary market.
[...] The price band can have a revision and such a revision in the price band shall be widely disseminated by informing the stock exchanges, by issuing press release and also indicating the change on the relevant website and the terminals of the syndicate members. In case the price band is revised, the bidding period shall be extended for a further period of three days, subject to the total bidding period not exceeding thirteen days. Cut Off Price In Book building issue, the issuer is required to indicate either the price band or a floor price in the red herring prospectus. [...]
[...] It is aimed to study about Principal Steps involved in floating a Public Issue Pre-issue Preparatory tasks Issue opens and at the expiry of the stipulated period closes Post-issue obligations. Appointment of Intermediaries Issuing of new shares & debentures. Book binding concept. Significance of securities market in the growth of an Indian economy. Present role of SEBI and the stock exchanges. Proportional allotment allowed in case of oversubscribed issues. Investment in security market and its interpret acts, circulars rules regulations and guidelines The study also an aim of educating the investors especially beginners a knowledge about investment in new shares. [...]
[...] The requirement of a due diligence study may be waived if a financial institution or a scheduled commercial bank has appraised the project in the preceding 12 months. b. For all companies : a. In respect of the requirement of paid-up capital and market capitalization, the issuers shall be required to include in the disclaimer clause forming a part of the offer document that in the event of the market capitalization (product of issue price and the post issue number of shares) requirement of the Exchange not being met, the securities of the issuer would not be listed on the Exchange. [...]