PRICING BY COMPANIES ISSUING SECURITIES
3.0 The companies eligible to make public issue can freely price their equity shares or any security convertible at later date into equity shares in the following cases:
3.1 Public / Rights Issue by Listed Companies
3.1.1 A listed company whose equity shares are listed on a stock exchange, may freely price its equity shares and any security convertible into equity at a later date, offered through a public or rights issue.
3.2 Public Issue by Unlisted Companies
3.2.1 An unlisted company eligible to make a public issue and desirous of getting its securities listed on a recognised stock exchange pursuant to a public issue, may freely price its equity shares or any securities convertible at a later date into equity shares.
Infrastructure company
3.2.2 An eligible infrastructure company shall be free to price its equity shares subject to the compliance with the disclosure norms as specified by SEBI from time to time.
3.3 Initial public Issue by Banks
3.3.1 The banks (whether public sector or private sector) may freely price their issue of equity shares or any securities convertible at a later date into equity share subject to approval by the Reserve Bank of India.
3.4 Differential Pricing
3.4.1 Any unlisted company or a listed company making a public issue of equity shares or securities convertible at a later date into equity shares, may issue such securities to applicants in the firm allotment category at a price different from the price at which the net offer to the public is made provided that the price at which the security is being offered to the applicants in firm allotment category is higher than the price at which securities are offered to public.
Explanation:
The net offer to the public means the offer made to the Indian public and does not include firm allotments or reservations or promoters� contributions.
3.4.1 A listed company making a composite issue of capital may issue securities at differential prices in its public and rights issue.
3.4.2 In the public issue which is a part of a composite issue differential pricing as per sub-clause 3.4.1 above is also permissible.
3.4.3 Justification for the price difference shall be given in the offer document for sub-clauses 3.4.1 and 3.4.2.
3.5 Price Band
3.5.1 Issuer company can mention a price band of 20% (cap in the price band should not be more than 20% of the floor price) in the offer documents filed with the Board and actual price can be determined at a later date before filing of the offer document with ROCs.
3.5.2 If the Board of Directors has been authorised to determine the offer price within a specified price band such price shall be determined by a Resolution to be passed by the Board of Directors.
3.5.3 The Lead Merchant Bankers shall ensure that in case of the listed companies, a 48 hours notice of the meeting of the Board of Directors for passing resolution for determination of price is given to the regional Stock Exchange.
3.5.4 The final offer document, shall contain only one price and one set of financial projections, if applicable.
3.6 Payment of Discounts / Commissions, etc;
3.6.1 No payment, direct or indirect in the nature of a discount, commission, allowance or otherwise shall be made either by the issuer company or the promoters in any public issue, to the persons who have received firm allotment in such public issue.
3.7.2 The companies which have already issued shares in the denomination of Rs.10/- or Rs.100/- may change the standard denomination of the shares by splitting or consolidating the existing shares.
3.7.3 The companies proposing to issue shares in any denomination or changing the standard denomination in terms of clause 3.7.1 or 3.7.2 above shall comply with the following:
b the denomination of the existing shares shall not be altered to a denomination of decimal of a rupee;
c at any given time there shall be only one denomination for the shares of the company;
d the companies seeking to change the standard denomination may do so after amending the Memorandum and Articles of Association, if required;
e the company shall adhere to the disclosure and accounting norms specified by SEBI from time to time.