TaxTMI 
TaxTMI 
Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Amendment) Regulations, 2022
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....edule XIV shall come into force from April 1, 2022, for issues opening on or after April 1, 2022. 3. In the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, - I. In regulation 2, in sub-regulation (1), (a) in clause (r), i. the words and symbol "or the offer document:" shall be substituted with the words and symbols "the offer document, or the letter of offer:". ii. in the proviso, the words and symbol "or the offer document;" shall be substituted with the words and symbols "the offer document, or the letter of offer;". (b) in clause (mm), the words and symbols "regulation 2(1)(q) of" shall be omitted. (c) in clause (lll), the words "wilful defaulter" wherever it appears, shall be substituted with the words "wilful defaulter or a fraudulent borrower" and the words "wilful defaulters" shall be substituted with the words "wilful defaulters or fraudulent borrowers". II. In regulation 5, in sub-regulation (1), in clause (c), the words and symbol "wilful defaulter." shall be substituted with the words and symbol "wilful defaulter or a fraudulent borrower.". III. In regulation 7, after sub-regulation (2), (a) in ....
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....re-issue shareholding of the issuer based on fully diluted basis, provisions of lock-in as specified under regulation 17 of these regulations shall be applicable, and relaxation from lock-in as provided under clause (c) of regulation 17 of these regulations shall not be applicable." VI. In regulation 15, (a) in sub-regulation (1), in clause (b), in point (i) of the proviso, the words "if the promoters and alternative investment funds", shall be substituted with the words "if the promoters and alternative investment funds or foreign venture capital investors or scheduled commercial banks or public financial institutions or insurance companies registered with Insurance Regulatory and Development Authority of India". (b) in sub-regulation (1), in clause (b), in point (ii) of the proviso, the words, numbers and symbol "sections 391 to 394 of the Companies Act, 1956 or" shall be omitted. (c) in sub-regulation (1), in clause (c), the words "the promoters and alternative investment funds", shall be substituted with the words "the promoters and alternative investment funds or foreign venture capital investors or scheduled commercial banks or public financial institutions or insuran....
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....ither of the sub-categories specified in clauses (a) or (b), may be allocated to applicants in the other sub-category of non-institutional investors." (b) in sub-regulation (4), in clause (ii), the sub-clause (i) and (ii) shall be re-numbered as sub-clause (a) and (b). XI. In regulation 40, in sub-regulation (1), the words, numbers and symbols "it shall appoint underwriters in accordance with the Securities and Exchange Board of India (Underwriters) Regulations, 1993" shall be substituted with the words and symbols "it shall appoint merchant bankers or stock brokers, registered with the Board, to act as underwriters.". XII. In regulation 41, (a) in sub-regulation (1), the words and symbol "public financial institution or by a scheduled commercial bank named in the offer document as bankers of the issuer:" shall be substituted with the words and symbol "credit rating agency registered with the Board:". (b) in sub-regulation (2), the words "at least ninety five per cent" shall be substituted with the words "hundred per cent", and the words and symbols ", excluding the proceeds raised for general corporate purposes," shall be omitted. XIII. In regulation 45, in sub-regulat....
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....b-regulation (5), in the proviso, the words, numbers and symbols "or the Companies Act, 1956 (to the extent applicable)" shall be omitted. XIX. In regulation 70, in sub-regulation (6), the words "wilful defaulter" shall be substituted with the words "wilful defaulter or a fraudulent borrower". XX. In regulation 74, in sub-regulation (2), the words "or warrants" shall be omitted. XXI. In regulation 81, in sub-regulation (1), the words, numbers and symbols "it shall appoint underwriters in accordance with the Securities and Exchange Board of India (Underwriters) Regulations, 1993." shall be substituted with the words and symbols "it shall appoint merchant bankers or stock brokers, registered with the Board, to act as underwriters:". XXII. In regulation 82, (a) in sub-regulation (1), the words and symbol "public financial institution or by a scheduled commercial bank named in the letter of offer as a banker of the issuer:" shall be substituted with the words and symbol "credit rating agency registered with the Board:". (b) in sub-regulation (2), the words "at least ninety five per cent" shall be substituted with the words "hundred per cent", and the words and symbols ",exc....
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.... activity indicated by its new name. (2) An issuer not satisfying the condition stipulated in the proviso to sub-regulation (1), shall make a further public offer only if the issue is made through the book building process and the issuer undertakes to allot at least seventy five per cent. of the net offer, to qualified institutional buyers and to refund full subscription money if it fails to make the said minimum allotment to qualified institutional buyers.". XXX. In regulation 104, (a) in sub-regulation (1), after clause (d), the following explanation shall be inserted, namely, "Explanation. - For the purposes of this regulation "finance for the specific project" shall mean finance for capital expenditures only." (b) after sub-regulation (2), the following sub-regulation (3) shall be inserted, namely, - "(3) The amount for: (i) general corporate purposes, and (ii) such objects where the issuer company has not identified acquisition / investment target, as mentioned in objects of the issue in the draft offer document and the offer document, shall not exceed thirty five per cent. of the amount being raised by the issuer: Provided that the amount raised for such ....
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....kers, registered with the Board, to act as underwriters". XXXVI. In regulation 137, (a) in sub-regulation (1), the words and symbol "public financial institution or by a scheduled commercial bank named in the offer document as the bankers of the issuer:" shall be substituted with the words and symbol "credit rating agency registered with the Board:". (b) in sub-regulation (2), the words "at least ninety five per cent" shall be substituted with the words "hundred per cent", and the words and symbols ", excluding the proceeds raised for general corporate purposes," shall be omitted. XXXVII. In regulation 141, in sub-regulation (2), the words "fifteen days" shall be substituted with the words "four days". XXXVIII. In regulation 145 , (a) in sub-regulation (3), after the words "retail individual investors" and before the words "and anchor", the symbols and words ", non-institutional investors" shall be inserted; (b) after sub-regulation (4), the following sub-regulation (4A) shall be inserted namely, - "(4A) The allotment of specified securities to each non-institutional investor shall not be less than the minimum application size, subject to the availability of shares ....
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....ly in the offer document." XLI. In regulation 158, (a) In sub-regulation (1), in clause (a), the words, symbols and numbers "(3) and (4) of sections 81 of the Companies Act, 1956 or sub-section" appearing after the word "sub-sections" and before the symbols and number "(3) ", shall be omitted. (b) In sub-regulation (1), after clause (a) the following proviso shall be inserted: "Provided that the provisions of this chapter shall apply to conversion of a loan or an option attached to convertible debt instruments into equity shares as mentioned in clause (a) subject to the provisions of the proviso to sub-section (3) of section 62 of the Companies Act, 2013." XLII. In regulation 159, (a) in sub-regulation (1), the words "six months" appearing after the words "during the" and before the word "preceding", shall be substituted by the numbers and words "90 trading days"; (b) in the explanation to sub-regulation (1), the words "six months" appearing after the words "during the" and before the word "preceding", shall be substituted by the number and words "90 trading days"; (c) after sub-regulation (3), the following sub-regulation (4) shall be inserted namely,- "(4) An is....
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...."wilful defaulter" shall be substituted with the words "wilful defaulter or a fraudulent borrower". (iv) after clause (i), the following clause (j) shall be inserted namely,- "(j) the current and proposed status of the allottee(s) post the preferential issues namely, promoter or non-promoter."; (b) in sub-regulation (2), (i) the words "its statutory auditors" appearing after the words "certificate of" and before the words "before the" shall be substituted by the words "a practicing company secretary"; (ii) after sub-regulation (2), the following explanation shall be inserted namely,- "Explanation.-For the purposes of sub-regulation (2), the issuer shall also host the certificate on its website and provide a link for the same in the notice for the general meeting of the shareholders considering the proposed preferential issue."; (c) the existing sub-regulation (3) shall be substituted with the following namely, - "(3) Specified securities may be issued on a preferential basis for consideration other than cash: Provided that consideration other than cash shall comprise only swap of shares pursuant to a valuation report by an independent registered valuer, which shal....
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....ch results in a floor price higher than that determined under these regulations, then the same shall be considered as the floor price for equity shares to be allotted pursuant to the preferential issue."; (c) in sub-regulation (3), (i) the words "twenty six weeks" appearing after the words "completion of" and before the words "from the", shall be substituted by the numbers and words "90 trading days"; (ii) the words, "average of the weekly high and low of the" appearing after the words "reference to" and before the words "volume weighted" shall be substituted by the number, words and symbol "90 trading days'"; (iii) the words "twenty six weeks" appearing after the words "during these" and before the words "and if", shall be substituted by the number and words "90 trading days"; (iv) after sub-regulation (3), the following proviso shall be inserted namely,- "Provided that if the Articles of Association of the issuer provide for a method of determination which results in a floor price higher than that determined under these regulations, then the same shall be considered as the floor price for equity shares to be allotted pursuant to the preferential issue."; (d) in sub-....
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....rd "exchange" and before the word "preceding", shall be omitted. (c) in sub-regulation (3), in clause (a), in sub-clause (ii), the words "wilful defaulter" shall be substituted with the words "wilful defaulter or a fraudulent borrower". XLVIII. In regulation 165, after the word "independent" and before the word "valuer", the word "registered" shall be inserted. XLIX. In regulation 166, the words and numbers "regulation 164 or regulation 165", shall be substituted with the words, numbers and symbols ", regulations 164, 164A, 164B or 165,". L. After regulation 166, the following regulation 166A shall be inserted namely,- "Other conditions for pricing 166A. (1) Any preferential issue, which may result in a change in control or allotment of more than five per cent. of the post issue fully diluted share capital of the issuer, to an allottee or to allottees acting in concert, shall require a valuation report from an independent registered valuer and consider the same for determining the price: Provided that the floor price, in such cases, shall be higher of the floor price determined under sub-regulation (1), (2) or (4) of regulation 164, as the case may be, or the price d....
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.... the words "from the", shall be substituted by the number and words "90 trading days". (g) after the proviso to sub-regulation (6), the following sub-regulation (7) shall be inserted namely,- "(7) Lock-in requirements for an allottee who has become a promoter due to change in control consequent to the preferential issue shall be the same as those applicable to the promoters and promoter group under this regulation." LII. After regulation 167, the following regulation 167A shall be inserted namely,- "Pledge of locked-in specified securities 167A. Specified securities, except SR equity shares, held by the promoters and locked-in under the provisions of these regulations, may be pledged as collateral for a loan granted by a scheduled commercial bank or a public financial institution or a systemically important non-banking finance company or a housing finance company: Provided that the loan has been granted to the issuer or its subsidiary(ies) for the purpose of financing one or more of the objects of the issue and pledge of specified securities is one of the conditions for sanction of the loan: Provided further that the lock-in on the specified securities shall continue ....
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....s "fourth day". LX. In regulation 228, in clause (c), the words "wilful defaulter" shall be substituted with the words "wilful defaulter or a fraudulent borrower". LXI. In regulation 230, after sub-regulation (2), the following sub-regulation (3) shall be inserted, namely, - "(3) The amount for: (i) general corporate purposes, and (ii) such objects where the issuer company has not identified acquisition or investment target, as mentioned in objects of the issue in the draft offer document and the offer document, shall not exceed thirty five per cent. of the amount being raised by the issuer: Provided that the amount raised for such objects where the issuer company has not identified acquisition or investment target, as mentioned in objects of the issue in the draft offer document and the offer document, shall not exceed twenty five per cent. of the amount being raised by the issuer: Provided further that such limits shall not apply if the proposed acquisition or strategic investment object has been identified and suitable specific disclosures about such acquisitions or investments are made in the draft offer document and the offer document at the time of filing of o....
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....ers and symbols, "the Companies Act, 1956 and/or" shall be omitted. LXXII. In Schedule VI, in Part A, (a) under the heading "Applicability", in proviso (a), the word "issue" shall be substituted with the words "public issue" and the words "Part B" shall be substituted with the words "Part D". (b) in Item (1) titled "Cover Pages", point (1), shall be substituted with the following, namely,- : "(1) Front outside cover page shall contain issue and issuer details, details of selling shareholders in tabular format along with their average cost of acquisition and offer for sale details, and other details as may be specified by the Board from time to time." (c) in Item (1) titled "Cover Pages", in point (2) word "outside" shall be substituted with word "inside". (d) in Item (4) titled "Offer Document Summary", after para (Q), the following new para shall be inserted, namely, - "(R) Exemption from complying with any provisions of securities laws, if any, granted by SEBI shall be disclosed." (e) in Item (5), titled "Risk factor:", in para (G), after clause 31, following clause 32 shall be inserted, namely, - "32. In case the proforma financial statements / restated consol....
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....CAI)". iv. in point (I), in para (B), in clause (iii), the words "statutory auditor of the issuer company" shall be substituted with the words "statutory auditor of the issuer company or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI) appointed by the issuer company.". v. in point (II), in para (A), in clause (i), the word "statutory auditor(s)" shall be substituted with the words "statutory auditor(s) or Chartered Accountants". vi. in point (II), in para (A), in clause (i), in sub-clause (d), the word "auditor" shall be substituted with the words "auditor or Chartered Accountants". vii. in point (II), in para (B), in clause (iii), the word "statutory auditor" appearing after the words "as certified by the" shall be substituted with the words "statutory auditor or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI),". viii. in point (II), in para (B), in clause (iii), the words "statutory auditor of the issuer company" shall be substituted with the words "statutory auditor of the issuer comp....
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....ssuer company" shall be substituted with the words "statutory auditor of the issuer company or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI).". LXXV. In Schedule VI, in Part B-1, in Item (14), in Para (B) titled "Other Financial Information", iii. in clause (iii) titled "Proforma financial statements", the word "statutory auditor" appearing after the words "as certified by the" shall be substituted with the words "statutory auditor or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI)". iv. in clause (iii), the words "statutory auditor of the issuer company" shall be substituted with the words "statutory auditor of the issuer company or chartered accountants, who hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI).". LXXVI. In Schedule VI, in Part E, in Annexure I, under the table titled "Restated Audited Financials" in Standalone and Consolidated table, the column for "FY4" and "FY5 (Last audited financial year prior to issue o....
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....ice band shall be at least one hundred and five per cent of the floor price." (iii) in clause (10), sub-clause (j) shall be substituted with the following, namely, - "j) There shall be a lock-in of 90 days on fifty per cent of the shares allotted to the anchor investors from the date of allotment, and a lock-in of 30 days on the remaining fifty per cent of the shares allotted to the anchor investors from the date of allotment." (iv) in clause (15), in sub-clause (b) , a) the words and symbol "and non-institutional investors", appearing after the words "institutional buyers" and before the symbol and words ", other than", shall be omitted; b) after the words "individual investors" and before the words "and allotment", the symbol and words ", non-institutional investors" shall be inserted. (b) in Part D, in clause (a), the word, number and symbols "clause 15 (c)" shall be substituted with the word, number and symbol "clause 15 (b)". LXXXII. In Schedule XIV , (a) in the heading of Part A, after the word "allotment", the words "for retail individual investors" shall be inserted; (b) after Part A, the following Part A1 shall be inserted namely, - "Part A1 - Illustrat....
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....20,00,000 - (500 * 340)}] * 160 (i.e. 500-340) 3 C 1,000 340 specified securities (i.e. the minimum lot of ₹ 2 Lakhs) + 119 specified securities [{5,00,000 - (500 * 340)} / {20,00,000 - (500* 340)}] * 660 (i.e. 1,000- 340) 4 D 1,400 340 specified securities (i.e. the minimum lot of ₹ 2 Lakhs) + 191 specified securities [{5,00,000 - (500 * 340)} / {20,00,000 - (500 * 340)}] * 1,060 (i.e. 1,400- 340) 5 E 1,660 340 specified securities (i.e. the minimum lot of ₹ 2 Lakhs) + 238 specified securities[{5,00,000 - (500 * 340)} / {20,00,000 - (500 * 340)}] * 1,320 (i.e. 1,660- 340) NOTE: For category 3(b), calculation methodology shall be similar to above. Example B. (1) Total number of specified securities on offer @ ₹ 600 per share: 1 crore specified securities. (2) Specified securities on offer for non-institutional investors' category: fifteen lakh specified securities. (3) Out of the total non-institutional investors' category, (a) Reserved for applications above two lakhs rupees and up to ten lakhs rupees -i.e., five lakhs of specified securities (b) Balance for applications above ten lakhs rupees - ten lakhs specified securities (4)....
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....000 7,00,000 29 36 720 500 3,60,000 15 37 740 1,000 7,40,000 29 38 760 1,000 7,60,000 29 39 780 1,000 7,80,000 29 40 800 1,000 8,00,000 29 41 820 1,000 8,20,000 29 42 840 1,000 8,40,000 29 43 860 500 4,30,000 15 44 880 1,000 8,80,000 29 45 900 1,000 9,00,000 29 46 920 1,000 9,20,000 29 47 940 1,000 9,40,000 29 48 960 1,000 9,60,000 29 49 980 1,000 9,80,000 29 50 1000 1,000 10,00,000 29 51 1020 1,000 10,20,000 29 52 1040 1,000 10,40,000 29 53 1060 1,000 10,60,000 29 54 1080 500 5,40,000 15 55 1100 500 5,50,000 15 56 1120 500 5,60,000 15 57 1140 500 5,70,000 15 58 1160 500 5,80,000 15 59 1180 500 5,90,000 15 60 1200 500 6,00,000 15 61 1220 500 6,10,000 15 62 1240 500 6,20,000 15 63 1260 500 6,30,000 15 64 1280 500 6,40,000 15 65 1300 500 6,50,000 15 66 1320 500 6,60,000 15 67 1340 500 6,70,000 15 68 1360 500 6,80,000 15 69 1380 500 6,90,000 15 70 1400 500 7,00,000 15 71 1420 500 7,10,000 15 72 1440 500 7,20,000 15 73 1460 500 7,30,000 15 74 1480 500 7,40,000 15 75 1500 500 7,50,000 15 ....