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CA Final Public Issue and Capital Raising Rules — practice questions

Explore 78 free Public Issue and Capital Raising Rules questions in CA Final Law. Open each question or exercise to read its content, reference answers and available explanation.

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Public Issue and Capital Raising Rules questions and exercises with answers

Showing questions 1–30 of 78.

Under Reg 5(1), debarment by which body bars an issuer from an IPO?Read the answer and worked solution →Which promoter status bars an IPO under Reg 5(1)(d) of ICDR?Read the answer and worked solution →Which outstanding options do not block an IPO under Reg 5(2)?Read the answer and worked solution →Reg 5(2)(b): fully paid convertibles must convert by filing of which document in a book-built IPO?Read the answer and worked solution →Reg 6(1)(a) needs net tangible assets of at least how much in each of three years?Read the answer and worked solution →Reg 6(1)(a): at most what share of net tangible assets may be monetary assets?Read the answer and worked solution →Reg 6(1)(b) needs an average operating profit of at least what over three years?Read the answer and worked solution →Reg 6(1)(d): after a name change, what minimum revenue share must come from the new activity?Read the answer and worked solution →Reg 6(2): a non-qualifying issuer must allot what share of net offer to QIBs?Read the answer and worked solution →Which issue route must an issuer failing Reg 6(1) use under Reg 6(2)?Read the answer and worked solution →Reg 6(3)(vi): what voting ratio may SR equity shares carry over ordinary shares?Read the answer and worked solution →Reg 6(3)(v): SR shares must be held how long before filing the red herring prospectus?Read the answer and worked solution →Reg 6(3)(viii): how many classes of SR equity shares may the issuer have?Read the answer and worked solution →An issuer with SR shares may list which shares in its Main Board IPO?Read the answer and worked solution →Reg 7(1)(c): promoters' securities must be in what form before the offer document is filed?Read the answer and worked solution →Reg 7(1)(d): what must happen to existing partly paid-up equity shares?Read the answer and worked solution →Reg 7(1)(e): firm finance arrangements are needed for what share of stated project means?Read the answer and worked solution →Reg 7(2): general corporate purposes may not exceed what share of the amount raised?Read the answer and worked solution →Reg 8: shares offered for sale must have been held for at least how long?Read the answer and worked solution →Reg 8: equity shares offered for sale to the public must be in what state?Read the answer and worked solution →The Reg 8 holding period relaxation covers a government company in which sector?Read the answer and worked solution →Reg 8: bonus shares offered for sale cannot arise from which source?Read the answer and worked solution →Reg 14(1): minimum promoters contribution as a share of post-issue capital?Read the answer and worked solution →If promoter holding is below the Reg 14(1) minimum, who may fill the gap?Read the answer and worked solution →Reg 14(3): promoters must satisfy the contribution rules how long before the issue opens?Read the answer and worked solution →Reg 14(4): fresh promoter contribution is kept in escrow with which institution?Read the answer and worked solution →Promoters contribution under Reg 14 is computed on which capital base?Read the answer and worked solution →When does the Reg 14 minimum contribution rule not apply?Read the answer and worked solution →Under Reg 15(1)(d), which securities cannot count toward promoter contribution?Read the answer and worked solution →Reg 20: locked-in certificates carry which inscription?Read the answer and worked solution →

Worked practice questions

Under Reg 5(1), debarment by which body bars an issuer from an IPO?

  1. Stock exchange
  2. Reserve Bank of India
  3. SEBI, the Board
  4. IRDAI authority
Show answer and solution

Correct answer: C. SEBI, the Board

Regulation 5(1)(a) bars an issuer whose promoters or directors are debarred from the capital market by the Board, meaning SEBI.

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Which promoter status bars an IPO under Reg 5(1)(d) of ICDR?

  1. Retired whole-time director
  2. Foreign national holder
  3. Minority investor group
  4. Fugitive economic offender
Show answer and solution

Correct answer: D. Fugitive economic offender

A promoter or director who is a fugitive economic offender makes the issuer ineligible for an initial public offer.

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Which outstanding options do not block an IPO under Reg 5(2)?

  1. Debenture conversion rights
  2. Warrants to promoters
  3. Options held by lenders
  4. Employee stock options
Show answer and solution

Correct answer: D. Employee stock options

The proviso to Reg 5(2) exempts options granted to employees under a compliant employee stock option scheme.

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