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Security Analysis and Portfolio Management

Notes (d) The securities forming part of promoters' contribution and issued last to the promoters
shall be locked-in first for the specified period.
(e) The securities issued to the financial institutions appearing as promoters, if issued
last, shall not be locked-in before the shares allotted to the other promoters.
Lock-in of Pre-issue Share Capital of an Unlisted Company
(a) The entire pre-issue share capital, other than that locked in as promoters' contribution,
shall be locked-in for a period of one year from the date of commencement of
commercial production or the date of allotment in the public issue, whichever is
later.
(b) The above provision is not applicable to the pre-issue share capital held by venture
capital funds and foreign venture capital investors.
(c) The above provision is also not applicable if shares are held for a period of at least
one year at the time of filing draft offer document with SEBI and being offered to the
public through offer for sale.

Notes E-IPO
The companies are now allowed to issue capital to the public through the on-line system
of the stock exchanges. For making such on-line issues, the companies should comply
with the provisions contained in Chapter 11A of SEBI (Disclosure and Investor Protection)
Guidelines, 2000. The appointment of various intermediaries by the issuer includes a
prerequisite that such members/registrars have the required facilities to accommodate
such an on-line issue process.
Qualified Institutional Buyers (QIBs)
Qualified Institutional Buyers are those institutional investors who are generally perceived
to possess expertise and the financial muscle to evaluate and invest in the capital market.
As per the SEBI guidelines, QIBs shall mean the following:
(a) Public Financial Institution as defined in Section 4A of the Companies Act, 1956

(b) Scheduled Commercial Banks
(c) Mutual Funds
(d) Foreign Institutional Investors registered with SEBI
(e) Multilateral and bilateral development financial institutions

(f) Venture capital funds registered with SEBI
(g) Foreign venture capital investors registered with SEBI
(h) State Industrial Development Corporations
(i) Insurance companies registered with the Insurance Regulatory and Development
Authority (IRDA)
(j) Provident Funds with a minimum corpus of 25 crores
(k) Pension Funds with minimum corpus of 25 crores.

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