What do you mean by minimum subscription in accounting?

Minimum subscription is the term which is used to represent the amount of the issue which has to be subscribed or else the shares can’t be issued if it is not being subscribed.

What is the size of minimum subscription As per Sebi 1 point 90% 92% 85% 80%?

However, the issuers issuing tax-free bonds, as specified by CBDT, will be exempted from the above proposed minimum subscription limit. Sebi said the base minimum issue size in the case of any public issue of debt securities shall be Rs100 crore.

What should be minimum subscription of a company?

Minimum subscription refers to the minimum amount which a company should raise at the time of issuing capital. The requirement for minimum subscription applies to all companies which raise funds from the public. Hence, in keeping with the expectations of the investors, the issue of capital should be halted.

What is minimum subscription As per Sebi?

At present, the regulations required companies doing a rights issue to ensure minimum 90% subscription. “In most cases, promoters undertake to subscribe to additional rights in case there is an under-subscription.

What is minimum subscription in issue of shares?

The minimum shares the company needs to get from the public out of the total issue by the date of closure. (Presently every company need to raise 90% of the issued amount). Else, the company shall refund the whole amount received.

What is the minimum subscription Class 11?

When shares are issued to the general public, the minimum amount that must be subscribed by the public so that the company can allot shares to the applicants is termed ‘minimum subscription’. As per the Companies Act of 1956, the minimum subscription of shares cannot be less than 90 per cent of the issued amount.

What is the limit of minimum subscription in percentage?

90%
question_answer 1) The limit of minimum subscription is 90% of the size of the issue.

What is the minimum subscription that every public issue should maintain?

According to SEBI (Securities and Exchange Board of India), every company needs a minimum subscription of 90% of the issued amount on the date of closure. In the event of this not happening, the company refunds the entire subscription amount it received.

What is the size of minimum subscription As per Sebi Class 11?

The amount of minimum subscription must be stated in the prospectus. As per guidelines of the Securities Exchange Board of India (SEBI), a company making any public issue of shares, debentures, etc. must receive at least 90% of Minimum Subscription before making allotment of shares or debentures to the public.

Which shares are issued at discount?

When Shares are issued at a price lower than their face value, they are said to have been issued at a discount. For example, if a share of Rs 100 is issued at Rs 95, then Rs 5 (i.e. Rs 100—95) is the amount of discount. It is a loss to the company.

What is mean by under subscription?

Undersubscribed is a situation in which the demand for an issue of securities such as an initial public offering (IPO) or another offering of securities is less than the number of shares issued.

What is minimum subscription in secretarial practice?

(a) Minimum subscription is the minimum amount raised by the company for obtaining a trading certificate and to start the work of allotment of shares. This amount is mentioned in the prospectus.

Is there a minimum subscription of 90%?

Infrastructure companies which are having public issues for them minimum subscription of 90% is not necessary and it should be given by the alternate source through that fund is coming to the company. 4. Infrastructure company can keep the issue open for 21 days only which would give the sufficient amount of time to get the funds for their issues.

How long can rights issue be kept open by SEBI?

Closure of Rights Issue: The rights issue must be kept open for a minimum period of 30 days. It cannot remain open for more than 60 days. 10. Minimum Subscription: SEBI requires the following clauses in respect of minimum subscription to be stated in the letter of offer.

Is it OK to submit offer document to SEBI?

“It is to be distinctly understood that submission of offer document to SEBI should not in any way be deemed or construed that the same has been cleared or approved by SEBI.

When do the SEBI guidelines come into force?

The Guidelines shall come into force with effect from the date of the circular. GUIDELINES ON INITIAL PUBLIC OFFERS THROUGH THE STOCK EXCHANGE ON-LINE SYSTEM (e-IPO).