Promoters Contribution and Lock in Requirements
Promoter’s contribution in public issues and lock-in requirements are discussed below.
Promoter’s Contribution The promoters contribution in different issues are outlined below.
Public Issue by Unlisted Companies Promoters should contribute at least 20 per cent of the post issue capital.
Offer for Sole by Unlisted Companies The promoters shareholding after offer for sale, should be at least 20 per cent of the post-issue capital.
Public Issue by listed Companies The participation of the promoters should either be (i) to the extent of 20 per cent of the proposed issue or (ii) to ensure shareholding to the extent of 20 per cent of the post-issue capital.
Composite Issue by Listed Companies At the option of the promoters, the contribution would be either 20 per cent of the proposed public issue or 20 per cent of the post-issue capital, excluding the rights issue component of the composite issue. For purposes of computing the promoters contribution in cases specified above, a minimum contribution of Rs 25,000 per application for each individual and Rs 1 lakh from firms and companies other than business associate, like dealers and distributors, would be eligible to be considered towards promoters contribution.