LISTED COMPANIES

S.S. Jain Subodh Law College

LISTED COMPANIES

Project Submission as the Partial Fulfillment of Periodic Evaluation

Of COMPANY LAW II

Submission To: Submitted By:

Miss Ankita Sharma Tushar Saxena

FACULTY OF LAW Roll no: - 53

V Semester

S.S. Jain Subodh Law College

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DECLARATION

I, TUSHAR SAXENA, do hereby declare that, this project titled LISTED COMAPANIES is an
outcome of the research conducted by me under the guidance of Miss Ankita Sharma (Asst. Prof. of
Law) at S.S. Jain Subodh Law College in fulfilment for the award of the degree of B.A.LL.B. at the
University of Rajasthan. I also declare that, this work is original, except where assistance from other
sources has been taken and necessary acknowledgements for the same have been made at appropriate
places. I further declare that, this work has not been submitted either in whole or in part, for any degree
or equivalent in any other institution.

Date: 28/02/2017
Place:JAIPUR

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CERTIFICATE

This is to certify that, the dissertation titled LISTED COMPANIES submitted by TUSHAR
SAXENA in fulfillment for the award of the degree of B.A.LL.B. at S.S. Jain Subodh Law College is
the product of research carried out under my guidance and supervision.

Miss Ankita Sharma

Asst. Prof. of Law
S.S. Jain Subodh Law College

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ACKNOWLEDGEMENT

I acknowledge with profundity, my obligation to Almighty God and my parents for giving me the grace
to accomplish my work, without which this project would not have been possible.
I express my heartfelt gratitude to my respected faculty, Miss Ankita Sharma (Asst. Prof. of Law) for
providing me with valuable suggestions to complete this dissertation.
I am especially grateful to all my faculty members at SS Jain Subodh Law College who have helped me
imbibe the basic research and writing skills.
Lastly, I take upon myself, the drawbacks and limitations of this study, if any.

Date:28/3/ 17
Place: Jaipur
TUSHAR SAXENA

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REVIEW OF LITERATURE

Corporate Social Reporting Practice: Evidence from Listed Companies in

Bangladesh
This article presents an empirical investigation into the corporate social reporting practices of listed
companies from Bangladesh, where corporate social reporting is a matter of voluntary disclosure.
Analysis of annual reports published in 2007 reveals that only 15.45% of listed companies made such
disclosures. This article presents an extensive survey of the contents, form, nature, and extent of
corporate social reporting practices of listed companies. Analysis over a wide range of industries reveals
that companies in the banking sector secure the highest rank in terms of corporate social reporting; three
fourths of all disclosures are generalized qualitative statements without any attempt at attestation; more
than one half of the disclosures are located in the director's report; and the mean amount of disclosures
was less than half a page.

A cost benefit study of voluntary disclosure: some empirical evidence from French
listed companies
This paper is related to the extent of disclosure in the annual reports of French listed companies to some
economic determinants. The sample includes the 1995 annual reports of 102 randomly selected
industrial and commercial firms. The extent of disclosure is measured by an index based on financial
and non-financial discretionary information. The model of hypothesis explaining voluntary disclosure is
defined as the interplay of contradictory forces: inducements deriving principally from agency theory
and limitations imposed by information costs. The results reveal that voluntary disclosure is
significantly related to size, foreign activity and to a proxy for proprietary costs.

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RESEARCH METHODOLOGY

Research Design

This Research Project titled LISTED COMPANIES has been written using the doctrinal method of
research, which involves the collection of data from different sources, like articles found in journals and
websites.

. Doctrinal research asks what the law is on a particular issue. It is concerned with analysis of the
legal doctrine and how it has been developed and applied. This type of research is also known as pure.

OBJECTIVES:

TO UNDERSTAND THE CONCEPT OF LISTED COMPANIES

TO UNDERSTAND THE PROCEDURE OF LISTING A COMPANY

Hypothesis:
It is very beneficial and important for a company to be a Listed Company.

Research problem:
What is the procedure followed in Listing of a Company?

Locale of study:
This project work has been done from Library, books, Articles, Home and various other sources

SOURCES OF DATA COLLECTION:

1. BOOKS
2. WEBSITES
3. ARTICLES
A primary source provides direct or firsthand evidence about an event, object, person, or work of
art. Primary sources include historical and legal documents, eyewitness accounts, results of
experiments, statistical data, pieces of creative writing, audio and video recordings, speeches etc.

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TABLE OF CONTENTS

Declaration ..II
Certificate ..III
Acknowledgement..IV
Review of Literature ..V
Research Methodology ....VI
Objective VI
Statement of Problem..VI
Hypothesis ..VI
Locale of Study .VI
Statement of ProblemVI
Sources of Data Collection VII
Introduction VI
Guidelines for listing...VI
Benefits of listingXX
CONCLUSION..XVI
Bibliography..XVIII

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INTRODUCTION

In corporate finance, a listing refers to the company's shares being on the list (or board) of stock that are
officially traded on a stock exchange. Normally the issuing company is the one that applies for a listing
but in some countries the exchange can list a company, for instance because its stock is already being
actively traded via informal channels. Initial listing requirements usually include a history of a few years
of financial statements (not required for "alternative" markets targeting young firms); a sufficient size of
the amount being placed among the general public (the free float), both in absolute terms and as a
percentage of the total outstanding stock; an approved prospectus, usually including opinions from
independent assessors, and so on. Stocks whose market value and/or turnover fall below critical levels
can get officially delisted; delisting is often the result of a merger or takeover.

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GUIDELINES FOR COMPANY LISTING

Guidelines for Company Listing

Listing means admission of securities to dealings on a recognised stock exchange. The securities may be
of any public limited company, Central or State Government, quasi governmental and other financial
institutions/corporations, municipalities, etc.

The objectives of listing are mainly to:

provide liquidity to securities;
mobilize savings for economic development;
protect interest of investors by ensuring full disclosures.

The BSE Limited has a dedicated Listing Department to grant approval for listing of securities of
companies in accordance with the provisions of the Securities Contracts (Regulation) Act, 1956,
Securities Contracts (Regulation) Rules, 1957, Companies Act, 2013, Guidelines issued by SEBI and
Rules, Bye-laws and Regulations of BSE.

BSE has set various guidelines and forms that need to be adhered to and submitted by the companies.
These guidelines will help companies to expedite the fulfilment of the various formalities and disclosure
requirements that are required at various stages of

Public Issues
o Initial Public Offering
o Further Public Offering
o Preferential Issues
o Indian Depository Receipts
o Amalgamation
o Qualified Institutions Placements

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A company intending to have its securities listed on BSE has to comply with the listing requirements
prescribed by it. Some of the requirements are as under:

Minimum Listing Requirements for New Companies

Minimum Requirements for Companies Delisted by BSE seeking relisting on BSE
Permission to Use the Name of BSE in an Issuer Company's Prospectus
Submission of Letter of Application
Allotment of Securities
Trading Permission
Requirement of 1% Security
Payment of Listing Fees
Compliance with the Listing Agreement
Cash Management Services (CMS) - Collection of Listing Fees

1. Minimum Listing Requirements for New Companies

The following eligibility criteria have been prescribed for listing of companies on BSE, through Initial
Public Offerings (IPOs) & Follow-on Public Offerings (FPOs):

The minimum post-issue paid-up capital of the applicant company (hereinafter referred to as "the
Company") shall be Rs. 10 crore for IPOs & Rs.3 crore for FPOs; and
The minimum issue size shall be Rs. 10 crore; and
The minimum market capitalization of the Company shall be Rs. 25 crore (market capitalization
shall be calculated by multiplying the post-issue paid-up number of equity shares with the issue
price).
Further :

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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
BSE not being met, the securities of the issuer would not be listed on BSE.
The applicant, promoters and/or group companies, shall not be in default in compliance of the
listing agreement.
The above eligibility criteria would be in addition to the conditions prescribed under SEBI (Issue of
Capital & Disclosure Requirements) Regulations, 2009.
The Issuer shall comply to the guidance/ regulations applicable to listing as bidding inter alia from
o Securities Contracts (Regulations) Act 1956
o Securities Contracts (Regulation) Rules 1957
o Securities and Exchange Board of India Act 1992
o And any other circular, clarifications, guidelines issued by the appropriate authority.
o Companies Act 2013

2. Minimum Requirements for Companies Delisted by BSE seeking Relisting on BSE

Companies delisted by BSE and seeking relisting at BSE are required to make a fresh public offer and
comply with the existing guidelines of SEBI and BSE regarding initial public offerings.

3. Permission to Use the Name of BSE in an Issuer Company's Prospectus

Companies desiring to list their securities offered through a public issue are required to obtain prior
permission of BSE to use the name of BSE in their prospectus or offer for sale documents before filing
the same with the concerned office of the Registrar of Companies.

BSE has a Listing Committee, comprising of market experts, which decides upon the matter of granting
permission to companies to use the name of BSE in their prospectus/offer documents. This Committee
evaluates the promoters, company, project, financials, risk factors and several other aspects before
taking a decision in this regard.

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4. Submission of Letter of Application

As per Section 73 of the Companies Act, 2013, a company seeking listing of its securities on BSE is
required to submit a Letter of Application to all the stock exchanges where it proposes to have its
securities listed before filing the prospectus with the Registrar of Companies.

5. Allotment of Securities

As per the Listing Agreement, a company is required to complete the allotment of securities offered to
the public within 30 days of the date of closure of the subscription list and approach the Designated
Stock Exchange for approval of the basis of allotment.
In case of Book Building issues, allotment shall be made not later than 15 days from the closure of the
issue, failing which interest at the rate of 15% shall be paid to the investors.

6. Trading Permission

As per SEBI Guidelines, an issuer company should complete the formalities for trading at all the stock
exchanges where the securities are to be listed within 7 working days of finalization of the basis of
allotment.
A company should scrupulously adhere to the time limit specified in SEBI (Disclosure and Investor
Protection) Guidelines 2000 for allotment of all securities and dispatch of allotment letters/share
certificates/credit in depository accounts and refund orders and for obtaining the listing permissions of
all the exchanges whose names are stated in its prospectus or offer document. In the event of listing
permission to a company being denied by any stock exchange where it had applied for listing of its
securities, the company cannot proceed with the allotment of shares. However, the company may file an
appeal before SEBI under Section 22 of the Securities Contracts (Regulation) Act, 1956.

7. Requirement of 1% Security

Companies making public/rights issues are required to deposit 1% of the issue amount with the
Designated Stock Exchange before the issue opens. This amount is liable to be forfeited in the event of
the company not resolving the complaints of investors regarding delay in sending refund orders/share

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certificates, non-payment of commission to underwriters, brokers, etc.

8. Payment by listing companies:

All companies listed on BSE are required to pay to BSE the Annual Listing Fees by 30th April of
every financial year as per the Schedule of Listing Fees prescribed from time to time.
The schedule of Listing Fees for the year 2011-12, is given here under:

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BENEFITS OF LISTING

Benefits of Listing
Listing provides an exclusive privilege to securities in the stock exchange. Only listed shares are quoted
on the stock exchange. Stock exchange facilitates transparency in transactions of listed securities in
perfect equality and competitive conditions. Listing is beneficial to the company, to the investor, and to
the public at large.

The important advantages of listing are listed below

Fund Raising and exit route to investors

Listing provides an opportunity to the corporate / entrepreneurs to raise capital to fund new
projects/undertake expansions/diversifications and for acquisitions. Listing also provides an exit route to
private equity investors as well as liquidity to the ESOP-holding employees.

Ready Marketability of Security

Listing brings in liquidity and ready marketability of securities on a continuous basis adding prestige
and importance to listed companies.

Ability to raise further capital

An initial listing increases a company's ability to raise further capital through various routes like
preferential issue, rights issue, Qualified Institutional Placements and ADRs/GDRs/FCCBs, and in the
process attract a wide and varied body of institutional and professional investors.

Supervision and Control of Trading in Securities

The transactions in listed securities are required to be carried uniformly as per the rules and bye-laws of
the exchange. All transactions in securities are monitored by the regulatory mechanisms of the stock
exchange, preventing unfair trade practices. It improves the confidence of small investors and protects
them.

Fair Price for the Securities

The prices are publicly arrived at on the basis of demand and supply; the stock exchange quotations are
generally reflective of the real value of the security. Thus listing helps generate an independent
valuation of the company by the market.

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Timely Disclosure of Corporate Information

The listing agreement signed with the exchange provides for timely disclosure of information relating to
dividend, bonus and right issues, book closure, facilities for transfer, company related information etc
by the company. Thus providing more transparency and building investor confidence.

Collateral Value of Securities

Listed securities are acceptable to lenders as collateral for credit facilities. A listed company can also
borrow from financial institutions easily as it is rated favourably by lenders of capital; the company can
also raise additional funds from the public through the new issue market with a greater degree of
assurance.

Better Corporate Practice

Since the violation of the listing agreement entails the de-listing/suspension of securities from the rings
of the exchange; the listed companies are expected to follow fair practices to the advantage of investors
and public.

Benefits to the Public

The data daily culled out by the stock exchange in the form of price quotations and others; provide
valuable information to the public which can be used for project and research studies. The stock
exchange prices can be an index of the state of the economy. Financial institutions, NRl, individual
investors etc. can take wise decisions before making investments.

Subdivision and Consolidation of Holdings

Stock exchange bye-laws provide for explicit rules for sub division and consolidation of securities as
desired by the investors. There is special trading sessions in the exchange for conversion of odd lots into
market lots arranged by financial and institutional investors. Thus listing helps to provide flexibility to
investors in the subdivision and consolidation of their holdings with speed and earnestness.

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CONCLUSION

Listing of securities is a procedure for the admission of securities to the Official Stock Exchange Market
according to the criteria prescribed by the Stock Exchange as well as disclosure of price-sensitive
materials and financial information to the public on a regular basis. High-rated trade companies with
extraordinary performances and strictly defined development goals, which prefer raising additional
capital and public wide-spread holdings, are listed on the Official Market of the Stock Exchange.

The decision for listing on the Official Market sends a clear signal to potential investors that the
company management is willing to run the company transparently. By listing on the Official Market the
company is obliged, regularly and continuously, to inform the public of all relevant activities that are
undertaken by the company and to give a fair view of the companys financial position. This constitutes
a clear disclosure of the companys performance to the public.

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BIBLIOGRAPHY

Websites Refferred

1. http://www.economicsdiscussion.net/wages/wages-definition-types-and-other-
details/7450
2. www.shareyouressays.com/.../12-main-objectives-of-national-wage-policy-in-india
3. http://shodhganga.inflibnet.ac.in/bitstream/10603/63658/6/06_chapter%201.pdf

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