Listed Securities





A. A company should have a minimum paid-up capital of Rs. 30 lakhs and the minimum offer to the public should be 25% of the issued capital or Rs. 20 lakhs worth of shares in face value, whichever is higher. SEBI Guidelines on Disclosure and Investor Protection will be applicable to all OTCEI issues.

B. Every company that intends to get listed has to be sponsored by a merchant banker ( Member/ Sponsor) of the Exchange. The Sponsor of the issue must arrange for Market Makers to give Buy & Sell quotes in the securities for an initial period of 18 months

C. Relaxation in Listing norms as compared to other stock exchanges:



 Companies that do not fulfill the following conditions are also eligible for listing on OTCEI:

     3 year dividend paying record in the last 5 years and;

     Appraisal and funding by financial institutions, will be allowed to raise funds by listing on OTCEI, provided they are :

      0 Sponsored by a Member / Sponsor of OTCEI

      0Appoint at least 2 market makers for continuous liquidity to their shares

     Bought out deals undertaken earlier and all future bought out deals - which may not fulfill the 3 year dividend record/ Financial Institution appraisal &
             funding criteria

Alongwith the above norms, all Public Limited Companies fulfilling the following criteria are eligible to get themselves listed on the OTC Exchange of India

QUALIFYING NORMS

 

1) COMPANY VALUATION

 

Net Tangible Assets (or)
Market Capitalization (or)
Net Income (in latest fiscal yr or 2 of last 3 fiscal yrs)

Rs. 1 crore (or)
Rs. 5 crores (or)
Rs. 0.25 crores

2) SHAREHOLDING

 

Minimum Total Float (shares)

11,00,000

Min. Public Float (shares)

5,00,000

Market Value of Public Float

Rs.2.50 crores

Minimum Offer to the public

(as % of total paid-up capital)

25%

Minimum no. of shareholders

1000

3) MARKET MAKING

 

No. of Market Makers

Minimum 2

Duration of Market Making

18 months

Obligation

Mandatory

Market making inventory

(at the time of the public issue)

Graded

4) COMPANY FACT FILE

 

Operating History (or)

Minimum Market Capitalization

1 year (or)

Rs. 5 crores

Corporate Governance

Yes

Compliance Standards

No defaults

Note:

 Net Tangible Assets means Tangible Fixed Assets minus Liabilities for financing these Fixed Assets

 If the operating history of the company is less than 1 year then the minimum market capitalisation will be Rs.5 crores. The other options mentioned in 1 above will not be
         available.

 It is also desirable for the company to have a website

Additional Requirements for Finance Companies

For Finance companies these additional conditions will also apply:

Registration with RBI as NBFC

Compulsory

Investment grade rating

in case of FDs or Debenture issues

Continuous Profitability

Past 3 years

Market making Inventory

 

Principal and Additional Market maker

10% min together

Debt Equity ratio

As per RBI guidelines




 CONTINUOUS LISTING REQUIREMENTS

The trading in the equity shares of the company will commence 3 days after the company is listed. Post-listing, the company is required to provide a Bank Guarantee of 1% of the issue amount in favour of OTCEI, for complying with continuous requirements. Bank Guarantee to be valid for a period of 3 years and to be provided prior to refund of security deposit. submitted earlier this Bank Guarantee is kept for continuos compliance and investor grievance Once listed the company would have to continuously fulfill the following criteria after a period of 18 months

1) COMPANY VALUATION

 

Net Tangible Assets
or
Market Capitalization
or
Net Income (in latest fiscal yr or 2 of last 3 fiscal yrs)

Rs. 0.75 crores

Or
Rs. 3.75 crores

Or
Rs. 0.15 crores

2) SHAREHOLDING

 

Minimum Total Float (shares)

8,25,000

Min. Public Float (shares)

3,75,000

Market Value of Public Float

Rs.1.90 crores

Minimum Offer to the public

(as % of total paid-up capital)

25%

Minimum no. of shareholders

1000

4) COMPANY FACT FILE

 

Operating History

 

Minimum Market Capitalization

N/A

Or

Rs. 3.75 crores

Corporate Governance

Yes

Compliance Standards

No defaults

 After listing of the securities of the company, if the company defaults in meeting with the continuous listing requirements for a period of 3 months, the scrip will
         be transferred to a "Watch-list" category

 Transfer to "Watch-list" category will be taken by an OTCEI Committee.

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