Corporate Funding & Listing in Stock Exchange
Company Secretary (CS) Professional Programme - Module 3, Paper 7
Corporate Funding & Listing in Stock Exchange:
CORPORATE FUNDING (finance) is the area of finance dealing with the sources of funding and the capital structure of corporations, the actions that managers take to increase the value of the firm to the shareholders, and the tools and analysis used to allocate financial resources. The primary goal of corporate finance is to maximize or increase shareholder value.
LISTING refers to the company's shares being on the list (or board) of stock that are officially traded on a stock exchange.
STOCK EXCHANGE (securities exchange) is an exchange where stock brokers and traders can buy and sell shares of stock, bonds, and other securities.
As per new syllabus 2018, it is covered under CS Professional Programme in Module 3, Paper 7- CORPORATE FUNDING & LISTING IN STOCK EXCHANGE.
- Level of Knowledge: Basic Knowledge
- Objective of ICSI:
- Part I: To provide practical knowledge of means of finance available to corporates at their various stages of journey, their suitability, pros and cons, process, compliances etc.
- Part II: To acquire knowledge of legal & procedural aspects of various types of listing, eligibility criteria, documentation, compliances etc.
- Mode of examination: Written based. (Case Studies & Practical Aspects)
- 100 Marks Paper:
|Part I: Corporate Funding||Part B: Listing|
|60 marks||40 marks|
|Indian Equity- Public Funding:
Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; Initial Public Offer (IPO)/ Further Public Offer (FPO); Preferential Allotment; Private Placement; Qualified Institutional Placement; Institutional Private Placement; Rights Issue; Fast Track Issue; Real Estate Investment Trust (REIT); Infrastructure Investment Trust (InvIT).
|Listing–Indian Stock Exchanges:
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015; Equity Listing (SME, ITP, Main);Debt Listing; Post listing disclosures.
|Indian Equity- Private funding:
Venture Capital; Alternative Investment Fund; Angel Funds; Seed Funding; Private Equity.
Applicability of Listing Regulations, Singapore Stock Exchange; Luxembourg Stock Exchange; NASDAQNGSM, NCM, NGM; London Stock Exchange- Main, AIM; U S Securities and Exchange Commission.
|Indian equity- Non Fund based:
Bonus issue; Sweat Equity, ESOP
|Various Procedural requirements for issue of securities and Listing.|
|Debt Funding – Indian Fund Based:
Debentures, Bonds; Masala Bonds; Bank Finance; Project Finance including machinery or equipment loan against property, Loan against shares; Working Capital Finance- Overdrafts, Cash Credits, Bill Discounting, Factoring etc. Islamic Banking.
|Preparing a Company for an IPO and Governance requirements thereafter, Appraising the Board and other functions in the organisations regarding the Post IPO/Listing Governance changes.|
|Debt Funding – Indian Non fund Based:
Letter of Credit; Bank Guarantee; Stand by Letter of Credit etc.
|Documentation & Compliances.|
|Foreign Funding - Instruments & Institutions:
External Commercial Borrowing (ECB); American Depository Receipt (ADR)/ Global Depository Receipt (GDR); Foreign Currency Convertible Bonds (FCCB); Foreign Currency Exchangeable Bonds (FCEB); International Finance Corporation (IFC), Asian Development Bank (ADB), International Monetary Fund (IMF).
|Other Borrowings Tools:
Inter-corporate Loans; Commercial Paper etc.; Deposits under Companies Act; Customer Advances/ Deposits.
|Non-Convertible Instruments- Non-Convertible Redeemable Preference Shares (NCRPs) etc.|