Chapter XI of the Securities and Exchange Board of India

Can you provide me the details of Chapter XI of Securities and Exchange Board of India or SEBI?

[Anuj Bhola]

The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India, established in the year 1988 and given statutory powers on 12 April 1992 through the SEBI Act, 1992.

It has enjoyed success as a regulator by pushing systematic reforms aggressively and successively.

Chapter XI of the Securities and Exchange Board of India

11.1 An issuer company proposing to issue capital through book building shall comply with the following:

A) 75% Book Building Process
11.2 In an issue of securities to the public through a prospectus the option for 75% book building shall be available to the issuer company subject to the following:
(i) The option of book-building shall be available to all body corporate which are otherwise eligible to make an issue of capital to the public.
(ii)
(a) The book-building facility shall be available as an alternative to, and to the extent of the percentage of the issue which can be reserved for firm allotment, as per these Guidelines.
(b) The issuer company shall have an option of either reserving the securities for firm allotment or issuing the securities through bookbuilding process.
(iii) The issue of securities through book-building process shall be separately identified / indicated as 'placement portion category', in the prospectus.
(iv)
(a) The securities available to the public shall be separately identified as 'net offer to the public'.
(b) The requirement of minimum 25% of the securities to be offered to the public shall also be applicable.
(v) In case the book-building option is availed of, underwriting shall be mandatory to the extent of the net offer to the public.
(vi) The draft prospectus containing all the information except the information regarding the price at which the securities are offered shall be filed with the Board.
(vii) One of the lead merchant banker to the issue shall be nominated by the issuer company as a Book Runner and his name shall be mentioned in the prospectus.

Chapter XI of the Securities and Exchange Board of India