Issues pertaining to primary issuance of debt securities
Summary
This SEBI circular mandates the inclusion of cash flow illustrations in debt security offer documents and adjusts payment dates for holidays. It relaxes allotment rules for public issues by allowing date-based upload priority instead of strict date-time priority. Additionally, it permits listed issuers to disclose unaudited financials with limited review reports and requires disclosure of debenture trustee contact details.
Text
Cash flows emanating from debt securities shall be mentioned in the Prospectus/Disclosure Document by way of an illustration. If coupon payment date falls on a Sunday or holiday, payment is made on the next working day; if maturity date falls on such days, redemption proceeds are paid on the previous working day.
Allotment in public issue of debt securities should be made on the basis of date of upload of each application into the electronic book. On the date of oversubscription, allotments should be made to applicants on a proportionate basis.
Listed issuers who have already listed equity shares or debentures may disclose unaudited financials with limited review report in the offer document for the stub period, subject to making necessary disclosures including risk factors.
Companies which have listed their debt securities shall disclose the name of the debenture trustees with contact details in their annual report and on their website on an ongoing basis.
Provisions in Para I apply to debt securities issued on or after December 01, 2013. Provisions in Para II and III apply to draft offer documents filed on or after November 01, 2013. Provisions in Para IV apply from December 01, 2013.
This circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992.
Source: SecMarx — Issues pertaining to primary issuance of debt securities. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.