Q. Am I required to sign any agreement"the broker or sub-broker?

Yes Forpurposeengaging-broker to execute tradesyour behalftime to timefurnish details relating to yourself for enablingbroker to maintain client registration form you have to sign“Member - Client agreement” if youdealing directly"a broker In case youdealing through-sub-broker then you have to sign-”Broker - Sub broker - Client Tripartite Agreement” Model Tripartite Agreement between Broker-Sub brokerClients is applicable only forcash segment The Model Agreement has to be executedthe non-judicial stamp paper The Agreement contains clauses definingrightsresponsibilityClient vis-à-vis broker sub broker The documents prescribedmodel formats The stock exchangesstock broker may incorporate any additional clauses"these documents provided thesenot"conflict"anythe clauses"the model document as alsoRules Regulations Articles Byelaws circulars directivesguidelines

Q. Can-retail investor also bid"a book-built issue?

Yes He can bid"a book-built issue for-value not more than Rs100000 Any bid made"excessthis will be considered"the HNI category

Q. Can I apply forIPO online?

As percyber rulesGovernmentIndia this facility is not provided Only"casebook building issuesbrokers can bid onlinebehalfsubscribers

Q. Can I changerevise my bid?

Yes The investor can change or revisequantity or price"the bid usingform for changingrevisingbid that is available along"the application form Howeverentire processchangingrevisingbids shall be completed withindateclosurethe issue

Q. Can I knownumbershares that would be allotted to me?

In casefixed price issuesinvestor is intimated aboutCANRefund order within 30 daysthe closurethe issue In casebook built issuesbasisallotment is finalized byBook Running lead Managers within 2 weeks fromdateclosurethe issue The registrar then ensures thatdemat credit or refund as applicable is completed within 15 daysthe closurethe issue The listingthe stock exchanges is done within 7 days fromfinalizationthe issue

Q. Does it mean that SEBI recommendsissue?

SEBI does not recommend any issue nor does take any responsibility either forfinancial soundnessany scheme orproject for whichissue is proposed to be made or forcorrectnessthe statements made or opinions expressed"the offer document

Q. Does SEBI approvecontentsthe issue?

It is to be distinctly understood that submissionoffer document to SEBI should not"any way be deemed or construed thatsame has been cleared or approved by SEBI The Lead manager certifies thatdisclosures made"the offer documentgenerally adequateare"conformity"SEBI guidelines for disclosuresinvestor protection"force fortime being This requirement is to facilitate investors to takeinformed decision for making investment"the proposed issue

Q. Does SEBI tag make my money safe?

For-public issue you can knowstatus by callingregistrar (you will know aboutregistrarthe Highlights Pagethe issue) after 30 to 40 days fromclosing datethe issue However"a book building issue you can knowstatus by callingregistrar after 20 days fromclosing date

Q. Does SEBI tag make my money safe?

The investors should makeinformed decision purely by themselves basedthe contents disclosed"the offer documents SEBI does not associate itself"any issueissuershould"no way be construed as-guarantee forfunds thatinvestor proposes to invest throughissue Howeverinvestorsgenerally advised to study allmaterial facts pertaining toissue includingrisk factors before considering any investment Theystrongly warned against any ‘tips’ or news through unofficial means

Q. Having applied forIPO how can I know my allotment status?

For-public issue you can knowstatus by callingregistrar (you will know aboutregistrarthe Highlights Pagethe issue) after 30 to 40 days fromclosing datethe issue However"a book building issue you can knowstatus by callingregistrar after 20 days fromclosing date

Q. HowNet Interest Margins (NIMs) calculated?

Net Interest Margin isrationet interest income to average interest-earning assets

NIM = Net Interest Income

Avg Interest Earning Assets

Where Net interest income isdifference between interest incomeinterest expense

And Average Interest-earning assetsloans advances given to borrowers by banks NBFCs Averagethe beginning to endthe period is considered for prudent calculation

Eg If Interest income = Rs 150 crore

Interest expense = Rs 80 crore

Interest-earning assets (at beginningyear) = Rs 2000 crore

Interest-earning assets (at endyear) = Rs 2500 crore

NIM = (150 – 80)

(2000 + 2500) 2

NIM =­­ 70


NIM = 311

Source sptulsiancom

Q. How do I interpretIPO Grades?

The gradesallocated on-5-point scalelowest being Grade 1highest Grade 5The meaningthese grades have been explained under Question 1"this FAQ

Q. How do I know if I am allottedshares And bytimeframe will I get-refund if I am not allotted?

The investor is entitled to receive-Confirmatory Allotment Note (CAN)"case he has been allotted shares within 15 days fromdateclosurea book Built issue The registrar has to ensure thatdemat credit or refund as applicable is completed within 15 daysthe closurethe book built issue

Q. How do I know ifbroker or sub broker is registered?

You can confirm it by verifyingregistration certificate issued by SEBI A brokers registration number begins"the letters "INB"thata sub broker"the letters “INS" Forbrokersderivatives segmentregistration number begins"the letters “INF” There is no sub-broker"the derivatives segment

Q. How do I know whether my order is placed?

The Stock Exchanges assign-Unique Order Code Number to each transactionis intimated by broker to his clientonceorder is executed this order code number is printedthe contract note The broker member has also to maintainrecordtime whenclient has placed orderreflectsame"the contract note along"the timeexecutionthe order

Q. How do I place my orders"the broker or sub broker?

You can either go tobroker’s sub broker’s office or placeorder overphone internet or as defined"the Model Agreement given above

Q. How does Book Building work?

Book building is-processprice discovery HenceRed Herring prospectus does not contain-price Insteadred herring prospectus contains eitherfloor pricethe securities offered through it or-price band along"the range within whichbids can move The applicants bid forshares quotingpricethe quantity that they would like to bid at Onlyretail investors haveoptionbidding at ‘cut-off’ Afterbidding process is complete‘cut-off’ price is arrived atthe linesDutch auction The basisAllotment (Refer Q 15j) is then finalizedletters allotmentrefund is undertaken The final prospectus"alldetails includingfinal issue pricethe issue size is filed"ROC thus completingissue process

Q. How does one come to know aboutissuesoffer Andwhere can I get copiesthe draft offer document?

SEBI issues press releases every week regardingdraft offer documents receivedobservations issued duringperiod The draft offer documentsput upthe website under ReportsDocuments section The final offer documents thatfiled"SEBIROCalso putfor information undersame section Copiesthe draft offer documents"hard copy form may be obtained fromofficeSEBI Mittal Court ‘A’ wing Ground Floor 224 Nariman Point Mumbai – 400021 on-paymentRs100 orSES LMs etc The soft copies can be downloaded fromSEBI website under ReportsDocuments section Some LMs also make it availabletheir web sites for download The final offer documents thatfiled"SEBIROC can also be downloaded fromsame sectionthe website

Q. How does SEBI ensure compliance"DisclosuresInvestor protection?

The Merchant Banker arespecialized intermediaries whorequired to do due diligenceensure that allrequirementsDIPcomplied"while submittingdraft offer document to SEBI Any non compliancetheir part attract penal actionSEBI"termsSEBI (Merchant Bankers) Regulations The draft offer document filed by Merchant Banker is also placedthe website for public comments OfficialsSEBI at various levels examinecompliance"DIP guidelinesensure that all necessary material information is disclosed"the draft offer documents

Q. How is NIM differentSpread?

NIM = (Interest Income - Interest Expense) Interest earning assets

Spreadthe other hand isdifference between yieldcostborrowingyield isinterest income earnedinterest earning assetscostborrowing is interest expense chargedinterest bearing liabilities

Spread = (Interest Income Interest earning assets) – (Interest Expense Interest bearing Liabilities)

Eg If Interest income = Rs 150 crore

Interest expense = Rs 80 crore

Interest earning assets = Rs 2250 crore

Interest bearing liabilities = Rs 3000 crore

NIM = (150 – 80) 2250

= 311

Spread = (150 2250) – (80 3000)

= 4

Source sptulsiancom

Q. How isRetail Investor defined as?

‘Retail individual investor’ meansinvestor who applies or bids for securitiesor for-valuenot more than Rs200000

Q. How long it takes to receive my money for-sale transactionmy shares for-buy transaction?

Brokers were required to make payment or give delivery within two working daysthe pay - out day However as settlement cycle has been reduced fromT+3 rolling settlement to T+2 wef April 01 2003pay outfundssecurities toclients bybroker will be within 24 hoursthe payout

Q. How long will it take afterissue forshares to get listed?

The listingthe stock exchanges is done within 7 days fromfinalizationthe issue Ideally it would be around 3 weeks afterclosurethe book built issue In casefixed price issue it would be around 37 days after closurethe issue

Q. How many days isissue open?

As per Clause 881 Subscription list for public issues shall be kept open for at least 3 working daysnot more than 10 working days In caseBook built issuesminimummaximum period forbidding will be open is 3–7 working days extendable by 3 days"casea revision"the price band The public issue made byinfrastructure company satisfyingrequirements"Clause 241 (iii)Chapter II may be kept open for-maximum period21 working days As per clause 882 Rights issues shall be kept open for at least 30 daysnot more than 60 days

Q. Howword Promoter has been defined?

The promoter has been defined as-person or persons who are"over-all controlthe company whoinstrumental"the formulationa plan or programme pursuant to whichsecuritiesoffered topublicthose named"the prospectus as promoters(s) It may be noted that-director officerthe issuer company or person if theyacting as such merely"their professional capacitynot be included"the definitiona promoter Promoter Group includespromoterimmediate relativethe promoter (ie any spousethat person or any parent brother sister or childtheperson orthe spouse) In case promoter is-company-subsidiary or holding companythat company any company"whichpromoter holds 10 or morethe equity capital orholds 10 or morethe equity capitalthe Promoter any company"which-groupindividuals or companies or combinations thereof who holds 20 or morethe equity capital"that company also holds 20 or morethe equity capitalthe issuer company

In casepromoter isindividual any company"which 10 or morethe share capital is held bypromoter orimmediate relativethe promoter or-firm or HUF"whichPromoter or any one or morehis immediate relative is-member any company"which-company specified"(i) above holds 10 or morethe share capital any HUF or firm"whichaggregate sharethe promoterhis immediate relatives is equal to or more than 10the totalall persons whose shareholding is aggregated forpurposedisclosing"the prospectus "shareholdingthe promoter group"
Chat Transcripts
Stocks | Sep 1, 2015, 10.00hrs

What is a good investment right now?

Sharmila Joshi,


Stocks | Sep 1, 2015, 10.00hrs

What is the outlook on equities?

Dipen Shah,

Head of Private Client Group Research, Kotak Securities

Stocks | Sep 1, 2015, 11.00hrs

Commodities that you should buy or sell.

Veeresh Hiremath,

Head- Commodities, Karvy Comtrade

Stocks | Sep 1, 2015, 12.00hrs

Which sector one should bet on?

Rahul Shah,

VP- Group Leader-Equity Advisory Group, Motilal Oswal

Stocks | Sep 1, 2015, 14.00hrs

Has Nifty bottomed out?

Sameet Chavan,

Technical Analyst -Equity, Angel Broking

Stocks | Sep 1, 2015, 15.00hrs

Which sectors will lead the next bull run?

Vivek Mahajan,

Head of Research, Aditya Birla Money

Stocks | Sep 1, 2015, 16.00hrs

What are technical indicators suggesting?

Hitendra Vasudeo,

Technical Analyst

Stocks | Sep 1, 2015, 16.00hrs

Should you bet on precious metals now?

Kunal Shah,

Head of Commodity Research, Nirmal Bang

Stocks | Sep 15, 2015, 10.00hrs

Which sectors will rule next bull run?

Pankaj Pandey,

Head- Research, ICICI Securities

Stocks | Sep 15, 2015, 10.00hrs

What`s a good strategy in this market?

Gaurav Dua,

Head Research, Sharekhan

Stocks | Sep 15, 2015, 11.00hrs

Where do markets stand technically?

Kunal Bothra,

Sr Technical Analyst, LKP

Stocks | Sep 15, 2015, 11.00hrs

What is the outlook on equities?

Varun Goel,

VP & Fund Manager- PMS, Motilal Oswal

Stocks | Sep 15, 2015, 12.00hrs

Will Nifty touch new highs?

Shrikant Chouhan,

Sr. Vice President- Technical Research, Kotak Securities

Stocks | Sep 15, 2015, 12.00hrs

Know the trends in gold and silver

Kaushal Jaini,

Head Wealth Management & Research, Dani Investment Services

Stocks | Sep 15, 2015, 14.00hrs

What are technical indicators suggesting ?

Ranak Merchant,

Technical Analyst - Strategies, Sushil Finance

Stocks | Sep 15, 2015, 14.00hrs

Which sectors will lead the next bull run?

CK Narayan,

Founder & CEO, Growth Avenues

Stocks | Sep 15, 2015, 15.00hrs

Is the market overvalued?

Gaurang Shah,

Asst VP, Geojit BNP Paribas Financial Services

Stocks | Sep 15, 2015, 15.00hrs

Know which sector will perform this earnings season

Deven Choksey,

MD, KRChoksey

Stocks | Sep 15, 2015, 16.00hrs

Will the markets surprise positively?

Sandeep Raina,

Research Analyst RCM , Edelweiss Financial Services

Stocks | Sep 15, 2015, 16.00hrs

What's a good strategy in the current market scenario

Kartik Mehta,

AVP- Institutional Equity Research, Sushil Finance