Eligibility Norms
For listing a company on BSE/BSESME through public offering of IPO/FPO, minimum listing requirements are as follows:-

For large-cap companies (BSE/NSE):

The minimum post-issue paid-up capital of the company shall be Rs. 10 crores for IPOs Rs.3 crore for FPOs
The minimum issue size shall be Rs. 10 crore
The minimum market capitalization of the Company shall be Rs. 25 crore (market capitalization to be calculated by multiplying the post-issue number of equity shares with the issue price)

For small & medium enterprises (BSE SME Platform)​:

1. The minimum post-issue paid-up capital of the company shall be at least Rs. 3 crore and at most Rs. 25 Crores
2. Minimum application and Trading Lot size – Rs.1,00,000/- or in multiples thereof
3. Underwriting – 100% (Merchant Bankers to underwrite 15% in own account)
4. Min No. of members for Issue – 50
5. Net worth (excluding revaluation reserves) of at least Rs.3 crores as per the latest audited financial results.
6. Track record of distributable profits in terms of sec. 123 of Companies Act, 2013 for at least two years out of immediately preceding three financial years and each financial year has to be a period of at least 12 months or the net worth shall be at least Rs.5 crores.

Procedure for floating an IPO
Floating an IPO is when a company is all set to issue stocks or shares to the public for the first time. The floating of shares can be done thru a fixed price method or book building method or a combination of both.

Involves an Issuer Company & IPO Process Initialization

1. To appoint lead manager as book runner who is the main underwriter
2. Appoint registrar of the issue
3. Appoint syndicate members or the appointed intermediate underwrites

Lead manager’s pre-issue role part – 1

1. Prepare draft offer prospectus document for IPO
2. File draft offer prospectus with SEBI

Review of draft prospectus by SEBI

1. Revert it back to Lead Manager in case of any clarification
2. If SEBI approve the draft offer prospectus, the draft offer prospectus becomes an Offer Prospectus

Lead manager’s pre-issue role part – 2

1. Submit this Offer Prospectus to Stock Exchanges, registrar of the issue and get it approved
2. Decide the issue date & issue price band
3. Modify Offer Prospectus that will now have a date and price band on it. This document is now called The Red Herring Prospectus.
4. The Red Herring Prospectus along with the IPO Application Forms are then printed and posted to the syndicate members and through which they are distributed to the investors.

Investor bidding for the public issue

1. Investors fill the application forms, place orders with the syndicate members
2. Syndicate members update the BSE/NSE with the bidding information
3. They also send all the physically filled forms and cheques to the registrar
4. Investor can revise the bidding by filling a form and syndicate member keeps updating the latest data

Public Issue Closes for biddings

Based on the bids received, lead managers evaluate the final issue price and update the ‘Red Herring Prospectus’ with the final issue the final price and send it to SEBI and Stock Exchanges.

Registrar – Processing IPO Applications

1. Registrar receives all application forms & cheques
2. Send the cheques for clearance and weed out all the bogus applications
3. Prepare ‘Basis of Allotment’.
4. Transfer shares in the Demat account of investors.
5. Refund the remaining money through ECS or Cheques

Lead manager – Stock Listing

Once all allocated shares are transferred in investors DP accounts, the Lead Manager with the help of Stock Exchange decides Issue Listing Date
Finally, the share of the issuer company gets listed in Stock Market.

Requirement Of The Documents For Listing ( BSE Exchange) :

1. Draft offer document
2. Copy of the Prospectus
3. Copy of resolution passed by the Board of Directors
4. Copy of the shareholders resolution passed under 62(1)(c) of Companies Act, 2013
5. Certificate from either of the following:the Managing Director / Company Secretary or PCS / Statutory or Independent Auditors
6. Copy of all show cause notice/orders issued
7. PAN & TAN of the Company.
8. DIN & PAN of Promoters and Directors.
9. Balance Sheets, P&L Statements and Cash Flow Statements for the last 5 years (or for such applicable periods)
10. Copies of major orders or contracts
11. Details if the present or any previous application of the Company/Group Company for listing of any securities has been rejected earlier by SEBI or by any stock exchange and reasons also.
12. Name of the exchange which is proposed to be designated Exchange for the issue.
13. Copies of agreements and memoranda of understanding between the Company and its promoters/ directors.
14. Articles & Memorandum of Association of the Company.
15. A certificate issued by the statutory auditor/practicing chartered accountant
16. Association, if any, of the directors/ promoters of the Company with any public or rights issue made during last 10 years.

What is the idea behind SME IPO?

Although SME contribute a large portion to Indian Economy like 40% of the workforce in India , 45% of manufacturing output etc. Yet previously, SMEs used to demand only on Banks and Financial Institutes for capital requirement that too subjected to various loan constraints.

But since 2012, BSE and NSE have launched SME platforms where they could raise funds from the capital markets. Also, after few years the company can get their share transferred from  SME platform to the Main Board.

What are the prerequisites to launch SME IPO?

The company should

- make necessary changes in the Board of Directors like appointment of Independent Director, CFO etc.
- Have its own website which contains the financial statement of last 3 years.
- Consult merchant bankers, share transfer agents and carry out agreement with them.

Eligibility criteria for IPO:

- As per latest audited financial statements, net tangible assets and net worth of company must be at least 3 crores separately.
- In terms of section 123 of the Companies Act , track record of distributable profit be at least 5 crores for last 5 years.
- The post- paid up capital of the company should at least be 3 crores.

SME IPO Process

Taking your business to the stock exchange is a big deal! There are a few important steps like making sure your financial records are in order, completing all the necessary paperwork, and ensuring you meet stock exchange eligibility rules. You’ll also need to check capital requirements for an SME IPO and fulfill certain conditions. Sounds overwhelming? Don’t worry! Our team will guide you through the entire process—making sure everything is done smoothly and on time.

- Strategy Planning

An IPO isn’t just about paperwork—it’s about having the right strategy for success! We help you:

1. Figure out the best way to approach your IPO
2. Ensure your business meets all listing requirements
3. Set up a growth-focused strategy for the public market

SME IPO DRHP Documentation Services
One of the most important documents in the IPO process is the Draft Red Herring Prospectus (DRHP). This document gives investors key insights into your company and future plans.
1. Prepare and file the DRHP
2. Ensure it meets all legal and regulatory requirements
3. Format it properly for a smooth approval process

Disclaimers:

The published information data is collected from the various consulting agencies websites and talkfever is not responsible for the accuracy of the content. For more information, we always recommend that please take advise with your expert professional consultants.