DELISTING

ASEMINAR REPORTONDELISTING OF EQUITY SHARES Submitted to

GURU NANAK DEV UNIVERSITY AMRITSARin partial fulfillment for the degree of Master of COMMERCE3rd sem(2nd year)( Session 2014-2015)Submitted to :Saurabh Kataria Submitted by: Navneet kaur Lecturer in Commerce M.COM 2nd Year University roll no-Post Graduate department of Commerce and business managementHindu CollegeDECLARATIONI hereby certify that the work embodied in the seminar report ,DELISTING OF EQUITY SHARES submitted to GURU NANAK DEV UNIVERSITY, Amritsar in Degree of M.com 3rd sem is my original work and has not been submitted by any degree or diploma at this or any other university,

ACKNOWLEDGEMENT My sincere thanks are due to all the contributors without whose efforts this seminar report would not have been completed. No task of this nature is a single person effort, so I am very thankful to Prof My SAURABH KATARIAUnder whose guidance I successfully completed my seminar report . Their unfailing interest and support gave a new dimension to my work. They made it possible to collect abundance of material, the relevant portion of which is quoted in this seminar report.I am also very grateful to Prof.Renu Sareen head department of commerce and business administration who helps me in completion of my seminar report without any difficulty .I also express my gratitude to the all respondent for their proper responses and cooperation during my dissertation project .I would like to extend my thanks to my all friends for their valuable suggestion and cooperation at various stages during my seminar report.Navneet kaurCHAPTER 1INTRODUCTIONMeaning of Delisting

Since Listing means admission of a Companys securities to the trading platform of a Stock Exchange, so as to provide marketability and liquidity to the security holders.

LISTING=STOCK EXCHANGE+ COMPANY

Delisting is totally the reverse of listing. Delisting means removal of securities of a listed company from a stock exchange. As a consequence of delisting, the securities of that company would no longer be tradeable at that stock exchange.

DELISTING= STOCK EXCHANGE- COMPANY

5 Delisting can be:

Voluntary Delisting

Compulsory Delisting

Thus, delisting can be voluntary i.e. at the will of the company or compulsory which is due to the violation of regulations and failure to meet the listing requirements of Stock Exchange. Inorder for astock to be traded on an exchange, the company that issues the stock must meetthe listing requirements set out by the exchange. Listing requirements include minimum share prices, certain financial ratios, minimum sales levels, and so on. If listing requirements are not met by a company, the exchange that lists the company's stockwill probably issue a warning of non-compliance to the company. If the company's failure to meet listing requirements continues, the stock exchange may delist the company's stock which is referred to as Compulsory Delisting. Delisting is different from the buy back of securities since in case of buy back of securities, company itself is the acquirer and thus provides the funds for buy back, but in case of delisting, the securities are acquired by a person other than the company and the funds have to be provided by that acquirer. Thus, these two processes are fundamentally different, thus the concern and safeguards for the shareholders should also be different.

Delisting is characterized by the Reverse Book Building Process in order to determine the Offer Price. All the public shareholders of the equity shares which are sought to be delisted shall be entitled to participate in the reverse book building process where the aim is to exit from the company. Thus, the process adopted is the same which is adopted in case of initial public offer process in which the aim is to invest in the company but in case of Delisting, the aim is to exit from the company.

EVOLUTION OF DELISTING IN INDIA In the earlier days, the public issues of shares and their pricing was looked after by the Controller of Capital Issues (CCI). But, in 1992, CCI was abolished and since then the issue of securities is being looked after by Securities and Exchange Board of India.

The purpose of establishing SEBI under SEBI Act, 1992 was to protect the interests of the investors in securities and to promote the development of, and to regulate, the securities market and for matters connected therewith or incidental thereto. Thus, SEBI prescribes the procedures, formulate the strategies and laws to regulate the securities market.

In one of such attempts, SEBI in the year 2002 constituted a committee on delisting of shares to examine and review the conditions for delisting of securities of companies listed on recognized stock exchanges, because Delisting from Indian stock exchanges has become a major issue for the financial regulator and the finance ministry to tackle. Almost every shareholder/investor has faced a scenario of having shares of a company that is seeking delisting from the stock exchange.

There is a growing trend of delisting of shares from Indian Stock Exchanges. The Multi National Companies have also been seeking delisting from the stock exchanges for a variety of reasons an the number of such companies has been on the increasing trend. This trend has engaged the attention of public, media and investor associations and has caused uneasiness and anxiety among investors.

At that time, the main concern was against the inadequacy of investors protection through the prevailing exit price mechanism. On the basis of the report of this committee, SEBI issued SEBI (Delisting of Securities Guidelines), 2003.

The salient features of Guidelines issued in 2003 were:

Public Shareholders will be an exit option if the company or its promoters propose to delist its securities from all the stock exchanges on which they were listed. However, no exit opportunity was required to be given in case the company continues to remain listed at stock exchanges having Nationwide trading terminals.

Price discovery by Reverse Book Building process.

Eligibility to participate in the book building process was available only to demat shareholders.

Option available to the promoters to accept or reject the price determined by the book building process.

The exit option to remain open for a period of 6 months after the closure of the offer.

These Guidelines covered the issues involved in Delisting of Securities to a great extent. However, there were certain areas over which hue and cry was made. Various representations and views, from intermediaries, stock exchanges, shareholders associations, chambers of commerce etc were given to the Regulators on the operational issues and procedural complications in the guidelines. Based on such representations, it was proposed to look into and suggest changes in the guidelines.

REASONS FOR DELISTING1. Non-compliance with Regulatory Framework: Notwithstanding the structural shortcomings in regulatory framework which is the pathetic monitoring of the listed companies results into mechanical delisting by the stock exchange which is referred to as Compulsory Delisting. Stock Exchanges have minimum requirements for the companies to remain listed on the exchange and in order to be traded on the exchange, company has to comply with those requirements which may be regarding the minimum share prices, minimum sales level and filing of financial reports etc. And if the company fails to comply with these requirements, then the stock exchange may delist its sock. Prior to delisting, show-cause notices are to be sent to the company but no intimation and exit option is required to be given to the non-promoter shareholders. Only wide public notices through newspapers and notice boards are to be issued by the Stock Exchange. Securities and Exchange Board of India 2. Capital Savings: The costs of being publicly traded company are substantial and are occasionally difficult to justify with a low market capitalization. As a result, deregistering can save a company millions and reward shareholders with a higher net income and earnings per share.

3. Relaxation of Regulations: Sometimes, companies go in for delisting in order to avoid the administrative process of complying with the regulatory requirements. For example, MNCs try to repatriate huge amount of profits to their parent companies every year in the form of huge dividend payouts. So, they plan to eventually delist the Indian subsidiary so that they do not have to comply with the rules and regulations for being listed on the Indian stock exchanges. So, delisting provides a sensible option to such MNCs which have major growth plans in India, since their managements want to enjoy entrepreneurial freedom without any regulatory oversight so that they can run operations without worrying about conflict of interest.

4. Moving Offshore: The companies that move offshore are either taken over by foreign companies or move their listing offshore without a substantive change in ownership. DELISTING: BOON OR A BANE

A stock that is delisted cannot be traded on that particular stock exchange. Thus, the stock is much harder to trade which makes it more illiquid. The question that arises is what should such investors do, whose investments become illiquid and who had invested in a particular company on the basis of the faith and trust in the system and also on the basis of the contents in the prospectus which mentions that the security would be listed on stock exchanges.

Since, if the securities of a company get delisted, then the investment will no longer be marketable and tradeable. And then, on top of it, these companies have delisted either themselves or the Exchanges delist them for non compliance or not meeting the criterion. In such circumstances, the shareholders are left in lurch with no option but to tender their shares at whatever price, which may be much lesser than the actual value of the Company. According to SEBI Delisting Guidelines 2003,the companies which have got themselves delisted, they have paid their shareholders according to the higher of the average of the weekly closing highs and lows for 26 weeks or 2 weeks.

Recently, a SEBI Committee conducted a study on 29 companies, which have been or are in the process of being delisted from the BSE, and it came to light that in 14 out of the studied 29 companies, the 52-week average was greater than the 26 weeks average. That is to say, the securities had a much better potential if they would have remained listed on the Exchange and the shareholders would have taken an exit in the ordinary course of trading in the Secondary Market. Thus, at this point, investors suffer losses. The shareholders of such companies, although are able to get back the market price of their shares but there is always an apprehension that they could have got a better price if they would have exit through the Secondary Market. From shareholders point of view, although he might be receiving a lesser value than the actual worth, but he stands to benefit in the sense that his blocked funds get released, which now he can utilize in the other scrips. Also, he is relieved from the tension of carrying dead stock on his head. There is yet another set of companies, that come out with Public Issues, utilize the shareholders funds, stopped making compliances with the Stock Exchange, the Stock Exchange suspends them, and as per the Guidelines, finally compulsorily delist them. In fact, there is a long list of such companies which have been delisted by the Stock Exchanges. Thus, at this point, the very objective of SEBI i.e. investors protection is still questionable? But from the Regulators (the Exchanges, SEBI etc.) point of view, such delistings are important because this cleans up the system and relieves them of the dead woodstock. Demand for the shares will drop significantly because many institutional investors are prohibited from investing in such stocks. When there is less demand for the stock of a company, liquidity of the shares could be a problem. In other words, trying to sell the shares may take longer than it would have taken at the major exchanges. The stocks which are delisted from the Stock Exchange due to an elevation of market listing standards, it has been observed that there is a decrease in trading volume after delisting. A significant negative stock price reaction around the delisting announcement period is also observed. On a comparison of all the above situations, it can be said that if the situation is beneficial for one, the other stands to lose. In certain situations, delisting becomes imperative to relieve the system of the unwanted trash companies. Thus, a complete ban on delisting is not possible. A judicious mix of listing and delisting has to be there in the system, to make it run smoothly. VOLUNTARY DELISTING OF EQUITY SHARESVoluntary Delisting, as its name implies, is done by the stock exchange at the will of the company. Under Voluntary Delisting, two options are available with the company:

Voluntary Delisting with NO EXIT OPPORTUNITY to the public shareholders.

Voluntary Delisting with EXIT OPPORTUNITY to the public shareholders.

VOLUNTARY DELISTING

VOLUNTARY DELISTING WITH NO EXIT OPPORTUNITYTO PUBLIC SHAREHOLDERSA company may delist its equity shares from one or more recognized stock exchanges where they are listed and continue their listing on one or more other recognized stock exchanges having nationwide trading terminals, then in that case, no exit opportunity needs to be given to the public shareholders. Recognized stock exchange having nation wide trading terminals means the Bombay Stock Exchange Limited, the National Stock Exchange of India Limited or any other recognized stock exchange which may be specified by the Board in this regard.

Procedure for delisting where no exit opportunity is required: The following procedure is required to be adopted for delisting of equity shares from one or more recognized stock exchanges, but hey continue to be listed on one or more recognized stock exchanges and no exit opportunity is required to be given to the public shareholders. This procedure is prescribed by Securities and Exchange Board of India (Delisting of Equity Shares) Regulation, 2009:

The first step in this regard is that the proposed delisting is to be approved by a resolution of the board of directors of the company in its meeting.

Then the company shall give a public notice of the proposed delisting in at least one English national daily with wide circulation, one Hindi national daily with wide circulation and one regional language newspaper of the region where the concerned recognized stock exchanges are located.

Then company shall make an application to the concerned recognized stock exchange for delisting its equity shares.

The fact of delisting will be disclosed in the first annual report of the company prepared after the delisting. Source: Securities and Exchange Board of India An application for delisting shall be disposed of by recognized stock exchange within a period of not exceeding 30 working days from the date of receipt of such application.

Voluntary delisting from few stock exchanges subject to listing atatleast one stock exchange can be summarized as:

VOLUNTARY DELISTING WITH EXIT OPPORTUNITY

TO THE PUBLIC SHAREHOLDERS A company may delist its equity shares and if after the proposed delisting, the equity shares does not remain listed on any recognized stock exchange having nation wide trading terminals, then exit opportunity will be given to all the public shareholders holding the equity shares. This is a lengthy process because the interests of the shareholders are involved. The voluntary delisting requires the mandatory meeting of all regulations including approval from board members, providing an exit opportunity for all public shareholders at a price quoted by them, and in-principle approval from the stock exchange among others.

Procedure for delisting where Exit Opportunity is required First of all, company has to obtain the prior approval of the board of directors of the company in its meeting;

After that, it has to obtain the prior approval of shareholders of the company by special resolution passed through postal ballot, but special resolution shall be acted upon only if the votes cast by public shareholders in favour are at least two times the number of votes cast by public shareholders against it.

Then, company will make an application to the concerned recognized stock exchange for in-principle approval of the proposed delisting in the form specified by the recognized stock exchange and it will be accompanied by the Audit Report.

Within one year of passing the special resolution, it will make the final application to the concerned recognized stock exchange

Final application shall be made within a period of one year from the date of passing of special resolution.

The final application for delisting shall be accompanied with the proof of giving the exit opportunity to the public shareholders.

EXIT OPPORTUNITY After getting in principle approval from the stock exchange, promoters will make a public announcement in at least one English national daily with wide circulation, one Hindi national daily with wide circulation and one regional language newspaper of the region where the concerned stock exchange is located. The public announcement shall also specify a date, which is not later than thirty working days from the date of the public announcement, for determining the names of shareholders to whom the letter of offer shall be sent. The promoter shall appoint a merchant banker registered with the Board and other intermediaries. (Source: Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 (http://www.sebi.gov.in./acts/delisting2009.pdf) ESCROW ACCOUNT The promoter shall open an escrow account and deposit in it the total estimated amount of consideration calculated on the basis of floor price and number of equity shares outstanding with public shareholders. Escrow Account will consist of cash deposited with the bank or bank guarantee or both. (Source: Note on Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 by Anushree Agarwal and Payal Jain; Vinod Kothari & Company. LETTER OF OFFER

The promoter shall dispatch the letter of offer to the public shareholders of equity shares, not later than forty five working days from the date of the public announcement, so as to reach them at least five working days before the opening of the bidding period. The letter of offer shall be accompanied with a bidding form for use of public shareholders. BIDDING PERIOD

The date of opening of the offer shall not be later than fifty five working days from the date of the public announcement. The offer shall remain open for a minimum period of three working days and a maximum period of five working days, during which the public shareholders may tender their bids. RIGHT OF SHAREHOLDERS TO PARTICIPATE IN BIDDING PROCESS

All public shareholders of the equity shares which are sought to be delisted shall be entitled to participate in the book building process except Promoters or persons acting in concert with the promoters and holder of depository receipts unless such receipt holders convert their receipts into equity shares. Source: Securities and Exchange Board of India (Delisting of Equity Shares) DETERMINATION OF THE FLOOR PRICE

Floor price where equity shares are frequently traded not to be less than the higher of the following: average of the weekly high and low of the closing prices of the equity shares of the company during the twenty six weeks OR Two weeks before the date of notification of delisting proposal. Floor price where the shares are infrequently traded to be determined by the Promoters and Merchant Banker taking into account the following: Highest price paid by promoter twenty six weeks before it was notified of Board meeting upto the date of public announcement, Return on net worth, Book value of the shares of the company, Earning per share. PROMOTER NOT BOUND TO ACCEPT THE OFFER PRICE Promoter is not bound to accept the equity shares at the price determined by the Book Building Process.

If the price is not acceptable, then the promoter will not move ahead with the delisting process.

The promoter has to ensure minimum level of public shareholding and the public shareholding can be increased by the following ways:

By the issue of new shares by the company,

By the promoter making an offer for sale of his holdings,

By the promoter making an offer for sale of his holdings through the secondary market in a transparent manner.

SUCCESSFUL OPEN OFFER

An offer will be considered as successful if the shareholding of the promoter together with the shares accepted through eligible bids reaches the higher of: 90% of the total shares issued of that class. Aggregate percentage of pre offer promoter shareholding and fifty percent of the offer size.

Within 8 working days from the closure of offer, the promoter and the merchant banker will make a public announcement in the newspaper regarding the final price determined.

The promoter will open a special account with banker to issue and transfer the payment consideration from Escrow Account.

Within 10 days from the closure of offer, the genuine shareholders will be made final payment.

NON-SUCCESSFUL OPEN OFFER If the offer is rejected, then the equity shares deposited by the shareholders will be returned within 10 days of the closing of the bidding process.

No final application will be filed with the stock exchange.

Escrow Account will be closed.

RIGHT OF THE REMAINING SHAREHOLDERS The remaining shareholders holding such equity shares may tender their shares to the promoter upto the period of atleast one year from the date of delisting.

The promoter shall pay the same final price at which the earlier acceptance of shares was made.

After making all payments, the balance amount in the escrow account will be transferred to the promoter.

Thus, in the case of voluntary delisting, the company voluntarily would decide to go for delisting and remove its shares off the stock exchange. This is a lengthy process because the interests of the shareholders are involved. The voluntary delisting requires the mandatory meeting of all regulations including approval from board members, providing an exit opportunity for all public shareholders at a price quoted by them, and in-principle approval from the stock exchange among others. A company may voluntarily choose to delist itself from the Stock Exchange due to variety of reasons such as:

In order to save the cost and increasing its net income.

Indian Subsidiary of MNCs may delist themselves in order to escape from the various regulation of the concerned Stock Exchange so that they can repatriate huge profits to their parent country.

In order to evade the tax liabilities.

Voluntary Delisting can be summarized as:

VOLUNTARY DELISTING FOR SMALL COMPANIES Under Securities and Exchange Board of India (Delisting of Equity Shares) Regulation, 2009 special provisions have been provided for the small companies. These companies need not to follow the Reverse Book Building Process.

Small Company

Small Company means a company having paid-up capital of upto one crore and its equity shares were not traded on any exchange in the one year immediately preceeding the date of decision of delisting OR A company having upto 300 public shareholders and the paid-up value of the shares held by such shareholders is upto Rs. One croreProcedure for voluntary delisting by Small company Board meeting and Appointment of Merchant Banker

The proposed delisting shall be approved by a resolution of the board of directors of the company in its meeting and the promoter will appoint a merchant banker who is registered with the Board.

Outcome of Board meeting to Stock Exchange

The outcome of the board meeting that Board of Directors has proposed to delist the company will be sent to concerned Stock Exchange. Special Resolution through Postal Ballot

The prior approval of shareholders of the company has to be taken by special resolution which will be passed through postal ballot, disclosing all material facts in the explanatory statement sent to the shareholders in relation to such resolution. The special resolution shall be acted upon only if the votes cast by public shareholders in favour of the proposal amount to at least two times the number of votes cast by public shareholders against it.

Determination of Exit Price

The promoters shall determine the exit price in consultation with the Merchant Banker. The price to be offered to the public shareholders for tendering their shares shall not be less than the exit price determined.

Application for In-Principle Approval

The company will make an application to the concerned recognized stock exchange for in-principle approval of the proposed delisting in the form specified by the recognized stock exchange. The application shall be accompanied by an audit report covering a period of six months prior to the date of the application.

In-Principle Approval by the Stock Exchange

The recognized stock exchange shall dispose off the Application of the In Principal approval within a period not exceeding thirty working days from the date of receipt of such application after considering the following aspects:

The resolution of investor grievances by the company;

Payment of listing fees to that recognized stock exchange;

The compliance with any condition of the listing agreement with that recognized stock exchange having a material bearing on the interests of its equity shareholders;

Any litigation or action pending against the company pertaining to its activities in the securities market or any other matter having a material bearing on the interests of its equity shareholders;

Any other relevant matter as the recognized stock exchange may deem fit to verify.

Public Notice

The company will give a public notice of the proposed delisting in at least one English national daily with wide circulation, one Hindi national daily with wide circulation and one regional language newspaper of the region where the concerned recognized stock exchanges are located.

Letter to all Public shareholders

The promoters shall write individually to all the public shareholders containing the following particulars: Intention of delisting the shares.

Exit price and justification of the exit price.

Seeking the consent of the shareholders for delisting and for dispensing the requirement of book building process for determination of the exit price.

Consent of the shareholders

Atleast 90% of the public shareholders shall give their consent in writing for the delisting of the shares and the shareholders shall have the option to surrender their shares at the exit price determined or to remain the shareholders even after delisting. This process has to be completed by the company within 75 days of dispatching the letters to shareholders. Payment to shareholders

The promoters shall make the payment in cash to the public shareholders who have tendered their shares within 15 working days from the date of expiry of 75 working days. Final Application to Stock Exchange

A final application for delisting will be made to the concerned recognized stock exchange accompanied with the proof of having given the exit opportunity.

Delisting Order

(The recognized stock exchange will dispose off the Application of the delisting filed by the company complete in all respects and pass the delisting order.

S Process for Voluntary Delisting for Small Companies can be summarized as

COMPULSORY DELISTING OF EQUITY SHARESEvery company listed on a Stock Exchange has to comply with the listing requirements imposed by the concerned Stock Exchange. These requirements may be related to minimum sales level or regarding financial ratios etc. If the company fails to comply with these requirements specified by the Stock Exchange, then the concerned Stock Exchange may delist the companys stock. Thus, delisting by the Stock Exchange due to non-compliance with the listing requirements, is referred to as Compulsory Delisting. Where a company has been compulsorily delisted then the company, its whole time directors, its promoters and the companies which are promoted by any of them shall not directly or indirectly access the securities market or seek listing for any equity shares for a period of ten years from the date of such delisting.

Procedure for Compulsory Delisting for Equity Shares Constitution of Panel: The first step in compulsory delisting by the Stock Exchange is the constitution of a Panel. The decision regarding compulsory delisting shall be taken by a panel to be constituted by the recognized stock exchange. This panel will consist of: Two directors of the recognized stock exchange (one of whom shall be a public representative);

One representative of the investors;

One representative of the Ministry of Corporate Affairs or Registrar of Companies; and

The Executive Director or Secretary of the recognized stock exchange.

Public Notice before Delisting Order: Before making a delisting order the recognized stock exchange shall give a notice in: one English national daily with wide circulation and one regional language newspaper of the region where the concerned recognized stock exchange is located and shall also display such notice on its trading systems and website. Time Period of making Representation: Time period of fifteen working days from the notice is given to any person who may be aggrieved by the proposed delisting within which he can made representations to the recognized stock exchange which has issued a notice for the delisting. Delisting order by the Recognized Stock Exchange

After considering the representations made by the company and any aggrieved person, the concerned Recognized Stock Exchange will pass the Delisting Order while considering the following aspects:

Nature and extent of the non-compliance by the company and the number and percentage of shareholders who may be affected by such non-compliance.

The status of compliance of the company with the office of the concerned Registrar of Companies.

Public Notice after Delisting Order

Where the recognized stock exchange passes the delisting order, it shall,

Publish a notice in one English national daily with wide circulation and one regional language newspaper of the region where the concerned recognized stock exchange is located.

Inform all other Stock exchanges where the shares of such company are listed about delisting.

Disclosure to be made in the Notice

Facts of such Delisting.

Name and Address of the company.

The fair value of the equity shares determined.

Name and Address of the promoters of the company who would be liable.

EXIT PRICE determined by an Independent Valuer

The Recognized Stock Exchange shall form a panel of expert valuers from whom the valuer will be appointed. The promoter of the delisted company shall acquire the equity shares from the public shareholders at the value determined by the valuer. Process for Compulsory Delisting of Equity Shares can be summarized as:

Special Powers to the Recognized Stock Exchange in case of Compulsory Delisting The recognized stock exchange can file prosecutions under relevant provisions of the Securities Contracts (Regulation) Act, 1956 against identifiable promoters and directors of the company for the alleged non-compliance.

The recognized stock exchange can also file a petition for winding up the company under section 433 of the Companies Act, 1956 and make a request to the Registrar of Companies to strike off the name of the company from the register.

Comparison between Voluntary and Compulsory Delisting

S. No CriteriaCompulsory DelistingVoluntary Delisting from all the Exchange(s)

1.Applicable Regulations Regulations 22 to 24 Regulations 5 to 21

2.Initiative Action Any Recognized Stock Exchange makes an order to delist the equity shares of a company. Any Company can voluntarily apply to the concerned stock exchange(s) for delisting.

3.Grounds Delisting order can be made on the non-fulfillment of the listing regulations of the respective exchange and on any other ground prescribed in the rules made under section 21A of SCRA, 1956. The Company either for cost benefit, or to comply with any of the rules and regulations etc may seek delisting from any of the exchange.

4.Public Notice Public Notice in this case be given by the Exchange Public notice and all announcements be given by the Promoters of the company.

5.Approvals The Panel of Experts has to take the decision after giving a reasonable opportunity of being heard to all the persons who may be aggrieved by the Delisting of the company. The Company seeking voluntary delisting shall take the approval of the concerned stock exchange(s) and also of public shareholders.

6.General Meeting of the shareholders No need of the General meeting of the shareholdersShareholders resolution to be passed through Postal ballot.

7.Appointment of Merchant Banker The complete process is monitored by the Panel of Experts The complete process is monitored by the Merchant Bankers

8.Reverse Book Building process No bids are invited from the Shareholders for determination of the Final Price Complete process of Reverse Book Building is to be completed for determination of the Final Price.

9.Debarred from the securities market The company/ Promoters/Directors are debarred from the securities market for a period of 10 years The company can not relist its securities for a period of 5 years.

Relisting of delisted Equity SharesUnder Securities and Exchange Board of India (Delisting of Equity Shares) Regulation, 2009 separate conditions are specified for relisting of equity shares which are delisted.

In case of VOLUNTARY DELISTING no application can be filed for the relisting of equity shares for a period of five years from the delisting.

In case of COMPULSORY DELISTING no application can be filed for the relisting of equity shares for a period of ten years from the delisting.

In case of Delisting due to WINDING UP of the company relisting is not allowed for five years.

But an application for listing of delisted equity shares can be entertained if the recommendation is made by the Board for Industrial and Financial Reconstruction under Sick Industrial Companies (Special Provisions) Act, 1985.

While considering an application for listing of any equity shares which had been delisted the recognized stock exchange shall have to give special attention to the facts and circumstances under which delisting was made.

An application for listing made in respect of delisted equity shares shall be deemed to be an application for fresh listing of such equity shares and shall be subject to provisions of law relating to listing of equity shares of unlisted companies.

CHAPTER 3

Data analysis and interpretation

An effort has been made to find out the companies which are delisted from Bombay Stock Exchange from 2005 to 2009 in order to find out the reasons for delisting of such companies, to make a year-wise analysis of the companies delisted from Bombay Stock Exchange and to calculate their Raw Return. The following table shows the list of companies which are delisted from BSE from 2005 to 2009 and their reason for delisting:

Serial No.Name of CompanyReasons for delisting

1.AMZEL AUTOMOTIVE LTD.Voluntary Delisting

2.BHARTI HEALTHCARE LTD.Voluntary Delisting

3.BLOSSOM INDUSTRIES LTD.Voluntary Delisting

4.FLEXTRONICS SOFTWARE SYSTEMS LTD.Voluntary Delisting

5.HINDUSTAN POWERPLUS LTD.Voluntary Delisting

6.VICKERS SYSTEMS INTERNATIONAL LTD.Voluntary Delisting

7.ADITYA INTERNATIONAL LTD.SEBI (Delisting of Securities Guidelines) 2003

8.ALEMBIC GLASS INDUSTRIES LTD.SEBI (Delisting of Securities Guidelines) 2003

9.DATT MEDIPRODUCTS LTD.Voluntary Delisting

10.DPIL LTD.Voluntary Delisting

11.DSP MERRILL LYNCH LTD.Voluntary Delisting

12.ESSAR TELEHOLDINGS LTD.SEBI (Delisting of Securities Guidelines) 2003

13.HARISIDDHA TRADING & FINANCE LTD.Voluntary Delisting

14.MERVEN DRUG PRODUCTS LTD.Voluntary Delisting

15.ONDEO NALCO INDIA LTD.SEBI (Delisting of Securities Guidelines) 2003

16.PANTALOON INDUSTRIES LTD.SEBI (Delisting of Securities Guidelines) 2003

17.SAN ENGINEERING & LOCOMOTIVE CO.LTD.Voluntary Delisting

18.APEEJAY TEA LTD.SEBI (Delisting of Securities Guidelines) 2003

19.BALMER LAWRIE-VAN LEER LTD.SEBI (Delisting of Securities Guidelines) 2005

20.EICHER LTD.SEBI (Delisting of Securities Guidelines) 2003

21.ESSAR STEEL LTD.SEBI (Delisting of Securities Guidelines) 2003

22.IGATE GLOBAL SOLUTIONS LTD.SEBI (Delisting of Securities Guidelines) 2003

23.PANASONIC AVC NETWORKS LTD.SEBI (Delisting of Securities Guidelines) 2003

24.SYNGENTA INDIA LTD.SEBI (Delisting of Securities Guidelines) 2003

25.WARTSILA INDIA LTD.SEBI (Delisting of Securities Guidelines) 2003

26.YOKOGAWA INDIA LTD.SEBI (Delisting of Securities Guidelines) 2003

27.BHURUKA GASES LTD.SEBI (Delisting of Securities Guidelines) 2005

28.BOSCH CHASSIS SYSTEMS INDIA LTD.SEBI (Delisting of Securities Guidelines) 2005

(Source: www.bseindia.com) Analysis:

Thus, 40 companies have been considered which are delisted from Bombay Stock Exchange from year 2005 till 2009. Out of these 40 companies, 70% companies i.e. 28 companies are delisted by the Stock Exchange as COMPULSORY DELISTING due to non-compliance with the clauses of listing agreement. While the rest 30% companies i.e. 12 companies are delisted as VOLUNTARY DELISTING. Both these types of delisting require a specific procedure as prescribed by SEBI. The procedure followed under Compulsory Delisting is different from the procedure that is followed under Voluntary Delisting.

REVERSE BOOK BULIDING

Like a book building process is used to determine an effective price for raising funds, a reverse book building process is used to determine an exit price for de-listing. Generally, when a person (seller) wants to exit, he doesn't know the intention of buyer. Reverse book building gives the seller a right to decide the price at which he wishes to exit, and the buyer, the option to decide whether he wants to accept or reject the same.

The process of price discovery is undertaken as in normal book building process, and the cut off price /final price is the one at which maximum shares are tendered. The promoter or acquirer shall appoint trading members for placing bids on the online electronic system.

At the end of the book building period, the merchant banker to the book building exercise shall announce the final price and the acceptance (or not) of the price by the promoter / acquirer. Investors may approach trading members for placing offers on the on-line electronic system. If the acquirer accepts the price, the shares are tendered to all those who have bid lower than that, and if the acquirer rejects the price, then the shares are returned to the shareholders.

Thus, Reverse Book Building is basically a process used for efficient price discovery. It is a mechanism where, during the period for which the Reverse Book Building is open, offers are collected from the share holders at various prices, which are above or equal to the floor price. The buy back price is determined after the offer closing date. REVERSE BOOK BULIDING SIZE OF DELISTED COMPANIESSerial No.Name of CompanyReverse Book Buliding Size (Rs. in crores)

1AMZEL AUTOMOTIVE LTD. 18,29,940

2BHARTI HEALTHCARE LTD. 13,85,99,413

3BLOSSOM INDUSTRIES LTD. 1,77,24,000

4FLEXTRONICS SOFTWARE SYSTEMS LTD. 603,39,74,388

5HINDUSTAN POWERPLUS LTD. 16,78,87,236

6VICKERS SYSTEMS INTERNATIONAL LTD. 4,59,31,875

7ADITYA INTERNATIONAL LTD. 1,25,52,240

8ALEMBIC GLASS INDUSTRIES LTD. 23,88,59,556

9DATT MEDIPRODUCTS LTD. 2,34,90,000

10DPIL LTD. 14,39,774

11DSP MERRILL LYNCH LTD. 109,55,01,600

12ESSAR TELEHOLDINGS LTD. 84,15,63,500

13HARISIDDHA TRADING & FINANCE LTD. 527

14MERVEN DRUG PRODUCTS LTD. 2,30,14,086

15ONDEO NALCO INDIA LTD. 72,43,91,845

16PANTALOON INDUSTRIES LTD. 78,65,62,280

17SAN ENGINEERING & LOCOMOTIVE CO.LTD. 3,61,30,149

18APEEJAY TEA LTD. 13,22,65,095

19BALMER LAWRIE-VAN LEER LTD. 14,31,54,438

20EICHER LTD. 42,04,20,000

21ESSAR STEEL LTD. 559,51,47,398

22IGATE GLOBAL SOLUTIONS LTD. 174,93,71,547

23PANASONIC AVC NETWORKS LTD. 12,22,10,542

24SYNGENTA INDIA LTD. 179,17,69,034

25WARTSILA INDIA LTD. 44,28,93,843

26YOKOGAWA INDIA LTD. 49,83,64,975

27BHURUKA GASES LTD. 88,098,550

28BOSCH CHASSIS SYSTEMS INDIA LTD. 213,76,77,684

29GE CAPITAL TRANSPORTATION FINANCIAL SERVICES LTD. 30,69,30,035

30GUJARAT JHM HOTELS LTD. 4,10,16,318

31INDUSTRIAL CABLES (INDIA) LTD. 1,79,83,500

32MATHER & PLATT PUMPS LTD. 42,75,44,116

33PARRY AGRO INDUSTRIES LTD. 99,85,76,383

34RAYBAN SUN OPTICS INDIA LTD. 59,12,65,428

35SAI SERVICE STATION LTD. 23,88,67,975

36TVS FINANCE AND SERVICES LTD. 8,59,19,790

37BHORUKA STEEL & SERVICES LTD. 2,98,49,550

38NIRYAT SAM APPARELS(INDIA) LTD. 1,03,32,000

39MADRAS ALUMINIUM CO.LTD. 168,23,25,000

40TUDOR INDIA LTD. 14,50,96,704

(Source: www.bseindia.com)

FINAL DELISTING PRICE OF DELISTED COMPANIES

Final Delisting Price is determined on the basis of Reverse Book Building Process. Promoter is not bound to accept the equity shares at the price determined by the Book Building Process. If the price is not acceptable, then the promoter will not move ahead with the delisting process.

Floor Price: The method of determining Floor Price is different for: where the shares are frequently traded and where the shares are infrequently traded.

The following table shows the Final Delisting Price and Floor Price of the companies delisted from Bombay Stock Exchange from 2005 to 2009:Serial No.Name of CompanyFloor PriceFinal Delisting

Price

1AMZEL AUTOMOTIVE LTD.105.00105.00

2BHARTI HEALTHCARE LTD. 82.60 83.00

3BLOSSOM INDUSTRIES LTD. 3.50 4.00

4FLEXTRONICS SOFTWARE SYSTEMS LTD. 579.00725.00

5HINDUSTAN POWERPLUS LTD.66.00109.00

6VICKERS SYSTEMS INTERNATIONAL LTD.85.00184.00

7ADITYA INTERNATIONAL LTD.60.00 60.00

8ALEMBIC GLASS INDUSTRIES LTD. 1742.001742.00

9DATT MEDIPRODUCTS LTD. 6.25 6.25

10DPIL LTD. 14.00 55.00

11DSP MERRILL LYNCH LTD. 2143.002143.00

12ESSAR TELEHOLDINGS LTD. 4949.004990.00

13HARISIDDHA TRADING & FINANCE LTD.263.57263.57

14MERVEN DRUG PRODUCTS LTD. 75.15150.00

15ONDEO NALCO INDIA LTD.724.90725.00

16PANTALOON INDUSTRIES LTD.330.00375.00

17SAN ENGINEERING & LOCOMOTIVE CO.LTD. 33.00 33.00

18APEEJAY TEA LTD.85.70103.00

19BALMER LAWRIE-VAN LEER LTD.46.0070.00

20EICHER LTD. 150.00 265.00

21ESSAR STEEL LTD.38.0048.00

22IGATE GLOBAL SOLUTIONS LTD. 288.90 410.00

23PANASONIC AVC NETWORKS LTD.14.1630.00

24SYNGENTA INDIA LTD. 351.80 750.00

25WARTSILA INDIA LTD.357.00622.00

26YOKOGAWA INDIA LTD.338.00478.00

27BHURUKA GASES LTD. 25.00 41.00

28BOSCH CHASSIS SYSTEMS INDIA LTD.514.00600.00

29GE CAPITAL TRANSPORTATION FINANCIAL SERVICES LTD. 66.80110.00

30GUJARAT JHM HOTELS LTD. 42.00 42.00

31INDUSTRIAL CABLES (INDIA) LTD. 10.0010.00

32MATHER & PLATT PUMPS LTD.124.64250.00

33PARRY AGRO INDUSTRIES LTD. 1759.11 1950.00

34RAYBAN SUN OPTICS INDIA LTD. 82.00140.00

35SAI SERVICE STATION LTD.189.54220.00

36TVS FINANCE AND SERVICES LTD. 20.29 25.00

37BHORUKA STEEL & SERVICES LTD. 10.00 10.00

38NIRYAT SAM APPARELS(INDIA) LTD.10.00 10.00

39MADRAS ALUMINIUM CO.LTD.74.77115.00

40TUDOR INDIA LTD.36.0070.00

NUMBER OF YEARS FOR WHICH DELISTED COMPANIES

REMAINED LISTED ON BOMBAY STOCK EXCHANGEThe following table shows the number of years for which it remained listed on Bombay Stock Exchange:

Serial No.Name of CompanyYears

1AMZEL AUTOMOTIVE LTD.15 years 6 months

2BHARTI HEALTHCARE LTD...

3BLOSSOM INDUSTRIES LTD.11 years 1 month

4FLEXTRONICS SOFTWARE SYSTEMS LTD.5 years 3 months

5HINDUSTAN POWERPLUS LTD..

6VICKERS SYSTEMS INTERNATIONAL LTD..

7ADITYA INTERNATIONAL LTD.10 years 11 months

8ALEMBIC GLASS INDUSTRIES LTD.15 years 2 months

9DATT MEDIPRODUCTS LTD..

10DPIL LTD.16 years 3 months

11DSP MERRILL LYNCH LTD.15 years 4 months

12ESSAR TELEHOLDINGS LTD.17 years 1 month

13HARISIDDHA TRADING & FINANCE LTD..

14MERVEN DRUG PRODUCTS LTD..

15ONDEO NALCO INDIA LTD.

16PANTALOON INDUSTRIES LTD.12 years 9 months

17SAN ENGINEERING & LOCOMOTIVE CO.LTD.12 years 10 months

18APEEJAY TEA LTD.19 years 11 months

19BALMER LAWRIE-VAN LEER LTD.5 years 2 months

20EICHER LTD.19 years 6 months

21ESSAR STEEL LTD.18 years

22IGATE GLOBAL SOLUTIONS LTD.7 years 7 months

23PANASONIC AVC NETWORKS LTD.10 years 2 months

24SYNGENTA INDIA LTD.6 years 5 months

25WARTSILA INDIA LTD.17 years 11 months

26YOKOGAWA INDIA LTD.17 years 2 months

27BHURUKA GASES LTD.17 years

28BOSCH CHASSIS SYSTEMS INDIA LTD.18 years 10 months

29GE CAPITAL TRANSPORTATION FINANCIAL SERVICES LTD.16 years 5 months

30GUJARAT JHM HOTELS LTD..

31INDUSTRIAL CABLES (INDIA) LTD.

32MATHER & PLATT PUMPS LTD.

33PARRY AGRO INDUSTRIES LTD.14 years 6 months

34RAYBAN SUN OPTICS INDIA LTD.16 years 9 months

35SAI SERVICE STATION LTD.14 years

36TVS FINANCE AND SERVICES LTD.8 years 1 month

37BHORUKA STEEL & SERVICES LTD.21 years 3 months

38NIRYAT SAM APPARELS(INDIA) LTD.12 years 6 months

39MADRAS ALUMINIUM CO.LTD.19 years 3 months

40TUDOR INDIA LTD.14 years 8 months

(Source: Capital Line Software)

RAW RETURN FROM LISTING PRICEThe following table shows the Raw Return of the companies delisted from Bombay Stock Exchange. Raw Return from Listing Price of the company is calculated as:

Delisting Price Listing Price

* 100

Listing Price

CALCULATION OF RAW RETURN FROM LISTING PRICE

Serial No.Name of CompanyRaw Return from Listing Price (D.P.-L.P./L.P.*100)

1AMZEL AUTOMOTIVE LTD.455.55%

2BHARTI HEALTHCARE LTD.

3BLOSSOM INDUSTRIES LTD.-60%

4FLEXTRONICS SOFTWARE SYSTEMS LTD.-10.5%

5HINDUSTAN POWERPLUS LTD.

6VICKERS SYSTEMS INTERNATIONAL LTD.

7ADITYA INTERNATIONAL LTD.-16.67%

8ALEMBIC GLASS INDUSTRIES LTD.16,829%

9DATT MEDIPRODUCTS LTD.

10DPIL LTD.-8.33%

11DSP MERRILL LYNCH LTD.10,399%

12ESSAR TELEHOLDINGS LTD.9,697%

13HARISIDDHA TRADING & FINANCE LTD.

14MERVEN DRUG PRODUCTS LTD.

15ONDEO NALCO INDIA LTD.

16PANTALOON INDUSTRIES LTD.2,900%

17SAN ENGINEERING & LOCOMOTIVE CO.LTD.22.22%

18APEEJAY TEA LTD.166.56%

19BALMER LAWRIE-VAN LEER LTD.250%

20EICHER LTD.1,678%

21ESSAR STEEL LTD.2.67%

22IGATE GLOBAL SOLUTIONS LTD.28.69%

23PANASONIC AVC NETWORKS LTD.200%

24SYNGENTA INDIA LTD.371.69%

25WARTSILA INDIA LTD.3,041%

26YOKOGAWA INDIA LTD.1,197%

27BHURUKA GASES LTD.7.19%

28BOSCH CHASSIS SYSTEMS INDIA LTD.2,995%

29GE CAPITAL TRANSPORTATION FINANCIAL SERVICES LTD.141%

30GUJARAT JHM HOTELS LTD.

31INDUSTRIAL CABLES (INDIA) LTD.......

32MATHER & PLATT PUMPS LTD.

33PARRY AGRO INDUSTRIES LTD.680%

34RAYBAN SUN OPTICS INDIA LTD.-20%

35SAI SERVICE STATION LTD.46.67%

36TVS FINANCE AND SERVICES LTD.-19.35%

37BHORUKA STEEL & SERVICES LTD.153%

38NIRYAT SAM APPARELS(INDIA) LTD.-4.67%

39MADRAS ALUMINIUM CO.LTD.447%

40TUDOR INDIA LTD.60.55%

Out of 40 companies which are delisted, Raw Return of 7 companies was negative which are as follows:

Blossom Industries Limited

Flextronics Software Systems Limited

Aditya International Limited

DPIL Limited

Rayban Sun Optics India Limited

TVS Finance and Services Limited

Niryat Sam Apparels (India) Limited

The remaining 33 companies earned a positive raw return after delisting. Alembic Glass Industries earned the highest Raw Return after delisting as it is 16,829% followed by DSP Merrill Lynch Ltd. as its Raw Return is 10,399%.

Thus, the companies with negative return suffered loss on delisting whereas the companies with positive Raw Return have gained on Delisting.

Raw Return of certain companies is not calculated because of unavailability of data about such companies.

CHAPTER 4

SCOPE OF STUDY There is a growing trend of delisting of shares from the Indian Stock Exchanges. But, delisting doesn't necessarily mean that a company is going to go bankrupt. Just as there are plenty of private companies that survive without the stock market, it is possible for a company to be delisted and still be profitable. However, delisting can make it more difficult for a company to raise money, and in this respect, it sometimes is a first step towards bankruptcy. For example, due to delisting, the credit rating of a companymight be further downgraded which may increase its cost of capital.

Moreover, being kicked out of a Stock Exchange is as disgraceful for a company as it is prestigious for it to be listed on it. Even if a company continues to operate successfully after being delisted, the main problem is the trust factor. People lose their faith in the stock. When a stock trades on the Stock Exchange, it has an aura of reliability and accuracy in reporting financial statements. When a company's stock is delisted, it loses its reputation.

Another problem with delisted stock is that investors who alreadyowna stock prior to the delisting may be forced to liquidate their positions, further depressing the company's share price by increasing the selling supply. This lack of coverage and buying pressure means the stock has an even steeper climb ahead to make it back on to a major exchange.

On the face of it, the primary responsibility to track such companies lies with the concerned stock exchange as it is the platform where the funds are raised. So it would seem natural that it should track the companies regularly and ensure compliance with the requirements under the listing agreement, instead of mechanically suspending and delisting them.

But, according to the BSE,Before suspending companies which are non-compliant, we give adequate notice to the market and media (through releases and advertisements). The existing shareholders should track these notices issued by the exchange.

So the responsibility also lies with the investors, who need to play a proactive role by keeping a close tab on the companies they have invested in. So, the investors should not invest in unknown, low-priced stocks unless they understand the associated riskssuspension and delisting being one of themand are willing to put up with these. If not, they should stick to known companies that are good, running businesses and whose stock is traded in good numbers every day.

CHAPTER 5

RESEARCH METHODOLOGY

So, Research Methodology involves way of conducting the research in order to solve a problem through collecting the data. Data to be collected may be as primary data or secondary data.

Primary Data It is considered to be the first hand information which is generally collected from various sources such as

Interview (direct or indirect),

Surveys

Questionnaires

Experiments etc.

Secondary Data- It is considered to be the second hand information which is generally collected from various sources such as

Internet,

Journals,

Magazines,

Print media etc.

Thus in this I have used secondary data for the purpose of collecting the data on how a money market generally effects the banking industries.

This project is based on the information available from secondary sources. The required information has been derived from the latest Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, various books, articles from newspapers on Delisting of Equity Shares and from various websites which provide the requisite information.

CHAPTER 6

OBJECTIVES OF STUDY

To understand the mechanism of Delisting of Equity Shares with special reference to Compulsory Delisting and Voluntary Delisting. To analyze the evolution of Delisting of Equity Shares in India. To analyze the present status of Delisting of Equity Shares in India with special reference to Securities and Exchange Board of India (Delisting of Equity Shares) Regulation, 2009. To study the reasons for delisting of the companies. To study the impacts of delisting of Equity Shares i.e. whether it is a boon or bane.PERIOD OF STUDY

The period chosen for the study is 2005-2009. Companies which are delisted from Bombay Stock Exchange from 2005 to 2009 are taken into consideration to study their reasons for delisting and for calculating their Raw Returns.

CHAPTER 7

CONCLUSION

Sometimes, it is argued that delisting is too harsh because it punishes stocks that could still recover. However, allowing such companies to stay listed would result in the major exchanges simply diluting the caliber of the companies that trade on them and degrading the respectability of the companiesthat maintain the listing requirements. But, from the shareholders point of view, this is the gravest situation. Here, the shareholders of the Companies are left in a lurch, without getting any money back for their investments in such companies. Although, as per the Delisting Guidelines, there are provision for payment of fair value to the public shareholders, but no control mechanism has ever been deployed to keep a check on such payments.

But from the Regulators (the Exchanges, SEBI etc.) point of view, such delistings are important because this cleans up the system and relieves them of the dead woodstock. Thus, delisting becomes imperative to relieve the system of the unwanted trash companies. Thus, a complete ban on delisting is not possible. A judicious mix of listings and delistings has to be there in the system, to make it run smoothly.

Although the Regulation prescribes various guidelines for compulsory and voluntary delisting of companies but, it does not mention the penalties/ consequences in case of defaulting promoters in making the payment of the fixed fair value to the public shareholders. So, the Regulators should be very cautious of the procedures followed, opportunities provided to the public shareholders and its overall impact on the investor confidence as a whole.

But, the new set of delisting provisions i.e. Securities and Exchange Board of India (Delisting of Equity Shares) Regulation, 2009 have come to strengthen the interest of public shareholders, while simultaneously facilitating the promoters objective to have greater control and flexibility of operations

To sum up, while allowing delistings, a complete check and control mechanism needs to be implemented for achieving the very objective of INVESTORS PROTECTION.

BIBLIOGRAPHYBOOKS

Dr. K.R. Chandratre Compendium on Securities and Exchange Board of India Capital Issues and Listing; Bharat Publishing House, New Delhi.

MY Khan Indian Financial System; Tata Mc Graw Hill Publishing Company Limited, New Delhi.

JOURNALS AND MAGAZINES

Chandy PR, Sarkar, Salil K and Tripathy Niranjan; Empirical Evidence on the Effects of Delisting from National Market System Journal of Economics and Finance, Spring 2004. Nirav Pankaj Shah; Delisting of Securities Business Law Magazine; March 2010. Anand Adhikari; The Delisting Blues Business Today Magazine; August 10, 2007.SECURITIES AND EXCHANGE BOARD OF INDIA REGULATIONS

Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; The Gazette of India, Extraordinary PART 3 SECTION-4 Securities and Exchange Board of India Notification, Mumbai, June 10, 2009. (http://www.sebi.gov.in./acts/delisting2009.pdf)ARTICLES IN NEWSPAPERS

ECONOMIC TIMES

http://economictimes.indiatimes.com/features/financialtimes/delistingofshares/articleshow/2661671.cms Delisting of Shares dated December 30, 2007.

FINANCIAL EXPRESS

http://www.financialexpress.com/news/sebinotifiesdelistingnorms/475064 SEBI notifies Delisting Norms dated June 12, 2009.

BUSINESS STANDARD

http://www.business-standard.com/india/news/sebi-to-announce-new-delisting-guidelines/61650/on SEBI to announce New Delisting Guidelines dated May 14, 2009.

BUSINESS STANDARD

http://www.business-standard.com/india/news/sebi-delisting-regulations-2009/361966/ SEBI Delisting Regulations, 2009 dated June 24, 2009

WEBSITES VISITED

www.delistedshares.co.in http://www.sebi.gov.in/commreport/delistreport.pdf; Report of Delisting Committee on Delisting of Shares PART 1

http://indianprofits.com http://india-financing.com; Note on Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 by Anushree Agarwal and Payal Jain; Vinod Kothari & Company.

http://www.rediif.com/money/2002/sep/17tut.htm http://www.e-investing.in www.thehindubusinessline.com http://www.legalserviceindia.com/article/1329/listing-&-delisting-of-securities.html http://www.advisoranalyst.com/glablog/2010/04/09 Indias Focus on Investors Protection

http://www.indiancorporatelaw.blogspot.com/2009/06/sebi-notifies-delisting-regulations.html www.sebi.gov.in http://www.investopedia.com/articles/stocks/07/delisting.asp

www.bseindia.com

NO EXIT OPPORTUNITY TO PUBLIC

SHAREHOLDERS

After delisting if continues to remain listed on any recognized stock exchange having nation-wide trading terminal

PROCEDURE FOR DELISTING

Board Resolution

Public notice in newspaper

Application to stock exchange for delisting

Disclosure of delisting in the 1st Annual Report of the Company prepared subsequent to delisting

Application to be disposed by SE within 30

days from receipt.

EXIT OPPORTUNITY TO PUBLIC

SHAREHOLDERS

Delists its equity shares from all recognized stock exchanges.

After delisting does not continue to remain listed on any recognized stock exchange having nation-wide trading terminal.

PROCEDURE FOR DELISTING

Board Resolution

Shareholders approval by POSTAL BALLOT

Number of votes cast by public

shareholders in FAVOUR to be at least TWO times the votes AGAINST it.

In-principle approval of the stock exchange

Make application for delisting within ONE year of passing resolution.

Application for In-principle approval to be disposed by SE within 30days from receipt.

Application for in-principle approval to be supported by: Auditors report

Final Application to SE to be supported by proof of having given the Exit opportunity

Means

RESEARCH

To search for a knowledge

METHODOLOGY

Means

Way of conducting a research.

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