IILM Academy Of Higher Learning Jaipur

PRESENTATION ON IPO(INITIAL PUBLIC OFFERINGS)

IPO(INITIAL PUBLIC OFFERINGS)

Introduction
Initial Public Offering (IPO's) is
It is an offering of either a fresh issue of securities or an offer for sale of existing securities or both by an unlisted company for the first time to the public. It is known as public going.

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The underwriting firm fix- the date of issue of shares - the offer price what kind of share to be issued like common or preferred etc. Public offerings are sold to - Institutional investors

- Retail investors.

Why an IPO?
To raise the capital of the company. Business Expansion Shareholder Wealth Enhanced Market Value/Better Valuation

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Currency for Future Acquisitions

Employee Recruitment and Retention Business Continuity

Advantage
The company gets a huge amount of capital from the investors for future growth of the company.

The company may again go in for a public issue to raise

further capital for the company. Generates publicity

Disadvantage

How the stock will perform in future or what will be the opening price on the first day will be difficult to predict.

L & T Finance Holding

Incorporated in 2008 L&T Finance Holdings is a financial holding company offering - a diverse range of financial products and services across the corporate, retail and infrastructure finance sectors - mutual fund products - investment management services LTF offers a spectrum of financial products and services for trade, industry and agriculture.

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Promoted by Larsen & Toubro Ltd

L&T Finance Holdings is registered with the RBI as a Systemically Important Non-Deposit Taking Non-Banking Financial Company and has applied for registration as a Core Investment Company.

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L&T
L&T Finance Holdings Limited

L&T Infrastructure Finance Company Limited

L&T Finance Limited

India Infrastructure Developers Limited

Other Investment

L&T Investment Management Limited

L&T Mutual Fund Trustee Limited

Continue.....

Objective of Issue
Repayment of inter corporate deposit issued by Promoter to the Company; To augment the capital base of L&T Finance and L&T Infra,

to meet the capital adequacy requirements to support the

future growth in their business; To achieve the benefits of listing on the Stock Exchanges;

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Issue Detail
Particulars
Issue Open

Details
Jul 27, 2011 - Jul 29, 2011

Issue Type
Issue Size Issue Size Face Value Issue Price Market Lot Minimum Order Quantity Listing At

100% Book Built Issue IPO

Equity Shares of Rs. 10 Rs. 1,245.00 Crore Rs. 10 Per Equity Share Rs. 51 - Rs. 59 Per Equity Share 100 Shares 100 Shares BSE, NSE

Red Herring
Red Herring is the preliminary prospectus of the company, which describes - The new issue of the stock and

- The prospects of the company.

- It is a registration statement which is filed with the SEC.

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The Red Herring doesn't contain any issue price in it.

It is called the Red Herring as there is a paragraph is red which states that the company is not selling its shares to the public without registration with the SEC(Securities and Exchange Commission).

Process of IPO
The IPO process is governed by the SEBI (Issue of Capital
and Disclosure Requirements) Regulations. Intermediaries to an issue of IPO: - Merchant Banker - Registrar to the issue

- Banker to the bank

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1. Free Pricing Regime: - Before 1992, Controller of Capital Issues (CCI) regulated price

- After 1992, the promoter and the merchant banker decide

the pricing.

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2. Fixed Price offerings:

- The firm and the merchant banker decided the offer price without taking the account of investors.

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3. Book-Building Process: - The company appoints a book runner - Book runner submits draft documents to SEBI - Offer of shares at a specified price range - Based on the bids, cut- off rate is decided - Public subscription, allotment and listing - In a book building issues, a red herring prospectus which does not have details of price of number of shares is filed with ROC(Registrar of Company).

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Book Builders of L & T Finance Holding

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Book Running Lead Managers

They are a lead merchant banker appointed by L&T and they performs the most Pre-Issue and Post-Issue activities which include operations, management and managing

accounts, dispatching of refunds.

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Registrar of the Issue

Sharepro Service Private Ltd finalize the list of eligible
allottees, ensure crediting of shares to the demat accounts of the eligible allottees and dispatch the refund orders.

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Allotment of a Book- Built Issue

Number of Times Issue is Subscribed (BSE + NSE)
Qualified Institutional Buyers (QIBs) Non Institutional Investors (NIIs) Retail Individual Investors (RIIs)

Shares Offered / Reserved

75,382,416 31,617,647 73,774,510

Employee Reservations
Others Total

10,204,082
23,529,412 214,508,067

ASBA(Application Supported by Blocked Amount)

ASBA refers to an application mechanism for subscribing to
initial public offers (IPO). ASBA as an additional payment mechanism for the benefits of certain investors applied in IPO. ASBA is an application containing an authorization to block

the application money in the bank account, for subscribing

to an issue.

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If an investor is applying through ASBA, his application

money shall be debited from the bank account only if his/her application is selected for allotment after the basis of allotment is finalized, or the issue is withdrawn/failed.

Application Form of L&T

THANK YOU!

Any Query

Presented by:
Megha Mittal
Neha Pareta Tarun Garg