SME IPO Consultant ,SME IPO Process and SME IPO Listing Eligibility
Challenges faced by SME Companies in the Current Market Scenario:
SME ‘s requires Working Capital for their Growth .
SME’s requires continuous up gradation in their Technology and infrastructure.
Finance Cost in case of SME’s are more due to inadequate systems or Internal Controls.
Due to Lack of Capital, SME’s are unable grow or Scale their Business at a Pace.
Meaning of SME IPO:
SME exchange ( BSE and NSE)are trading platform dedicated especially for the trading of shares of small and medium enterprises.
Listing provides an exclusive privilege to securities in the stock exchange. Only listed shares are quoted on the stock exchange. Stock exchange facilitates transparency in transactions of listed securities in perfect equality and competitive conditions. Listing is beneficial to the company, to the investor, and to the public at large
How can the companies benefit from SME IPO listing?
1)Fund Raising and exit route to investors
Ipo Listing provides an opportunity to the corporate / entrepreneurs to raise capital to fund new projects/undertake expansions/diversification and for acquisitions. Ipo Listing also provides an exit route to private equity investors as well as liquidity to the ESOP-holding employees.
2)Ability to raise further capital
An initial listing increases a company's ability to raise further capital through various routes like preferential issue, rights issue, Qualified Institutional Placements and ADRs/GDRs/FCCBs, and in the process attract a wide and varied body of institutional and professional investors.
3)Collateral Value of Securities
Listed securities are acceptable to lenders as collateral for credit facilities. A listed company can also borrow from financial institutions easily as it is rated favorably by lenders of capital; the company can also raise additional funds from the public through the new issue market with a greater degree of assurance.
4)Ready Marketability of Security
SME Ipo Listing brings in liquidity and ready marketability of securities on a continuous basis adding prestige and importance to listed companies.
5)Merger & Acquisition
The company’s shares can be used as currency to pay for acquisitions in lieu of hard cash.
Employees can be given shares as ESOPS instead of cash. Precious cash can be preserved for business expansion.
Basic Eligibility Criteria for SME Listing on BSE SME
The SME company’s net worth in the latest audited financial results should be at least 3 Crores.
The SME companies capital should be at least Rs 3 crores.
Company must be in Existence for Minimum Three Years. Out of Three Years Must have made distributable Profits for Two Years.
Above are Basic Requirements to get listed on BSE SME Platform. The Listing Requirements at the time of
applying to Exchange will apply.
SME IPO Sizes
SME IPO size can be typically as low as INR 2Cr and can go upto INR 100Cr- .( Off course depends on the Eligibility Criteria)
Migration from BSE SME Platform to the Main Board
It is mandatory for the company to be listed and traded on the SME Exchange for a minimum period of two years and then they can migrate to the Main Board as per the guidelines specified by SEBI .
Services Provided by Maxout :-
Maxout has experience in handling End to End SME IPO and can provide Below Services
SME IPO Advisory Services
SME IPO Documentation Service
SME IPO Fund Raising
Dealing with Various Agencies for SME IPO Listing
Main Board IPO (BSE and NSE) )Listing
The objectives of Main Board IPO listing are mainly to
Provide liquidity to securities;
Protect interest of investors by ensuring full disclosures.
Unlocking the Value
Easy Access to capital
Eligibility Criteria for Main Board IPO Listing as per ICDR 2018 :
At least 3 crore rupees, calculated on a restated and consolidated basis, in each of the preceding three full years of which not more than fifty per cent. are held in monetary assets.
it has an average operating profit of at least 15 crore rupees, calculated on a restated and consolidated basis, during the preceding three years with operating profit in each of these preceding three years;
If it has changed its name within the last 1 year, at least 50% of the revenue, calculated on a restated and consolidated basis, for the preceding one full year has been earned by it from the activity indicated by its new name.
Additional Eligibility criteria for Main Board IPO Listing:-
The minimum post-issue paid-up capital of the applicant company shall be Rs. 10 crore
The minimum issue size shall be Rs. 10 crore
The minimum market capitalization of the Company shall be Rs. 25 crore
(SEBI ( ICDR) Rules at the time of Actual Main Board IPO Listing will be applicable )
Services Provided by Maxout for Main Board IPO Listing:-
Maxout can provide Below Services
Main Board IPO Listing Advisory Services
Main Board IPO Documentation Service
Main Board IPO Fund Raising
Dealing with Various Agencies for Main Board IPO Listing.