SME Exchange – Listing Requirements

The 5 P'S of Listing Process on BSE SME

Planning

The Issuer Company consults and appoints the Merchant Banker/s in an advisory
capacity.

Preparation

The Merchant Banker prepares the documentation for filing after:

 conducting due diligence regarding the Company i.e checking the

documentation including all the financial documents, material contracts,
Government Approvals, Promoter details etc.
 and planning the IPO structure, share issuances, and financial requirements

Process

Application procedure:

 Submission of DRHP/Draft Prospectus - These documents are prepared by the

Merchant Banker and filed with the Exchange as well as with SEBI as per
requirements.
 Verification & Site Visit - BSE verifies the documents and processes the same. A
visit to the company's site shall be undertaken by the Exchange official .The
Promoters are called for an interview with the Listing Advisory Committee.
 Approval - BSE issues an In Principle approval on the recommendation of the
Committee, provided all the requirements are compiled by the Issuer Company.
Filing of RHP/Prospectus - Merchant Banker files these documents with the
ROC indicating the opening and closing date of the issue.
Once approval is received from the ROC, they intimate the Exchange regarding
the opening dates of the issue along with the required documents.

Public Offering

The Initial Public Offer opens and closes as per schedule. After the closure of IPO, the
Company submits the documents as per the checklist to the Exchange for finalization of
the basis of allotment.
Post Listing

BSE finalizes the basis of allotment and issues the Notice regarding Listing and Trading.

The Process of SME IPO - Step-by-step Guide to Schedule IPO

What is SME IPO Process in India?

Small and medium enterprise Initial Public Offer (SME IPO) is the process when an
unlisted SME company sells its shares to the public for the first time and listed on the
stock exchange for trading. IPO Process makes a private SME company to a public
limited company.

The process of SME IPO is also known as SME company 'going public'.

Fundraising through IPO is a complex process. It involves many legal processes, audits,
and professionals to help with the process. Some of the critical players in this process
include:

 Company Promoters
 SME IPO Assistants
 Registrar of Companies (RoC)
 Merchant Banker or Investment Banker
 Bankers
 Registrar and Transfer Agents (RTA)
 Market Maker
 Depositories (CDLS, NSDL)
 Stock Exchanges (BSE or NSE)
 Auditors

SME IPO Process Steps (High Level)

IPO process is easy for SMEs in comparison to mainline IPO. But it is still a long and
complicated process. It takes at least 4 months from the day company appoints a lead
manager.

1. Appointment of Merchant Banker

2. Capital Structuring, Due Diligence, and Pre-IPO preparation
3. Appointment of Bankers, Registrar, Market Makers, RTA etc.
4. Preparation of Offer Document (DRHP)
5. Filing of DRHP with Stock Exchange
6. Approval from Exchange and RoC
7. Issue Pricing
 8. The Opening of Public Issue
9. Closure of the Issue & Allocation of Shares
10. Listing & Trading at the Exchange

SME IPO Process Steps with Timelines

SME IPO Process Schedule

Sr. Activity Timeline
No.
1 Conversion of Company into Public Limited Company, if applicable X
2 Preparation of Documents for conversion and submission to the Registrar of X+7
Companies (RoC) for approval. Documents includes Alteration of Memorandum,
Articles & filing of necessary forms for appointment of aforesaid directors.
3 ROC approval for conversion X+9
4 Identification & appointment of Registrar and Transfer Agents (RTA or R & T Agent). X+11

Submission of Master Creation forms with NSDL, CDSL for establishing connectivity.
5 Appointment of Managing Director, Whole Time Director, Independent Directors, X+14
Company Secretary.

Deciding about their pay, sitting fees etc.

6 Constitution of committees including Audit, Shareholder Grievance and Payments. X+17
7 Preparation of website of the Company & hosting code of conduct on the website X+21
8 The signing of Tri-Partite Agreement with NSDL & CDSL and receipt of ISIN X+24
9 Identification & appointment the peer review auditors. Get the financials of last 5 X+26
years restated and for last 1 year re-audited from peer review auditors.
10 Appointment of Merchant Banker & Market Maker X+29
11 Preparation of Project Report and Draft Red Herring Prospectus (DRHP) X+33
12 Filing of Draft Red Herring Prospectus (DRHP) with stock exchange along with an X+38
application for in-principle approval with the stock exchange
13 Clearance from stock exchange X+75
14 Filing of Prospectus with ROC & getting it cleared from ROC X+80
15 Filing of Final Prospectus with Stock exchange and SEBI X+87
16 Opening of the Issue X+90
17 Closing of the Issue X+93
18 Finalization of Basis of Allotment by RTA & submit to the Stock exchange X+96
19 RTA & Issuer to process corporate action to carry out lock-in for pre-issue capital held X+96
in depository system.
20 Filing of corporate action form with NSDL & CDSL and demat credit of shares X+97
21 Filing of listing application with the Stock exchange to give listing and trading X+98
permission.
22 Post Issue Advertisement in a English, a Hindi and a Bengali Newspaper with the wide X+98
circulation within 10 days of completion of all activities.
23 Receipt of trading approval from Stock exchange X+99