Understanding ASBA and Price Band Justification
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Understanding ASBA and Price Band Justification

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Questions and Answers

What is the minimum extension period for the Bid/Offer Period in case of a revision in the Price Band?

  • Three additional Working Days (correct)
  • Two additional Working Days
  • One additional Working Day
  • Four additional Working Days

    • What is the maximum duration that the Bid/Offer Period can extend to?

  • Fifteen Working Days
  • Five Working Days
  • Ten Working Days (correct)
  • Twenty Working Days

    • What must investors ensure regarding their PAN in relation to the auction?

  • That their PAN is linked with Aadhaar (correct)
  • That their PAN is secure and not used
  • That their PAN is linked with a bank account
  • That their PAN has been updated annually

    • In the event of unforeseen circumstances, what is the minimum extension period allowed for the Bid/Offer Period?

    <p>One additional Working Day</p> Signup and view all the answers

    What document should be inspected for information on the company's objectives?

    <p>Memorandum of Association</p> Signup and view all the answers

    What does the term 'force majeure' refer to in this context?

    <p>Unforeseen and uncontrollable events</p> Signup and view all the answers

    Which regulation outlines the terms for making the Offer?

    <p>Securities Contracts (Regulation) Rules, 1957</p> Signup and view all the answers

    How will changes to the Bid/Offer Period be communicated?

    <p>By issuing a public notice and updating respective websites</p> Signup and view all the answers

    What does ASBA stand for?

    <p>Application Supported by Blocked Amount</p> Signup and view all the answers

    What is a key feature of applying through ASBA?

    <p>It involves blocking funds in a bank account.</p> Signup and view all the answers

    What should investors rely on when making an investment decision?

    <p>Information included in the Red Herring Prospectus.</p> Signup and view all the answers

    What is stated regarding the receipt of cheques in public issues?

    <p>No cheques will be accepted.</p> Signup and view all the answers

    Which entity is crucial for the company's operations according to the document?

    <p>HMC, the Promoter</p> Signup and view all the answers

    Why should investors refer only to price band advertisements?

    <p>To ensure accurate information about valuation.</p> Signup and view all the answers

    What type of market activity does the 'Basis for Offer Price' section refer to?

    <p>Weighted average cost of acquisition.</p> Signup and view all the answers

    Which risk factor is mentioned related to dependency on HMC?

    <p>Increased royalty fees payable to HMC.</p> Signup and view all the answers

    What was the daily average sales figure for Ola Electric in October?

    <p>1,154 units</p> Signup and view all the answers

    What factor contributed to the increase in Ola Electric's sales?

    <p>A boost from the 'BOSS' sale</p> Signup and view all the answers

    What was the trend in Ola Electric's sales prior to October?

    <p>Sales experienced a decline</p> Signup and view all the answers

    Which data source reported Ola Electric's sales figures?

    <p>Ministry of Road Transport and Highways</p> Signup and view all the answers

    What was the nature of Ola Electric’s sales trend before the reported uptick in October?

    <p>Decline after a period of growth</p> Signup and view all the answers

    Which email is designated for investor grievances?

    <p><a href="mailto:[email protected]">[email protected]</a></p> Signup and view all the answers

    What should investors refer to before applying for the Offer?

    <p>The 'Risk Factors' section of the RHP</p> Signup and view all the answers

    Which of the following is NOT a method for addressing complaints mentioned in the content?

    <p>Visiting the investor's local office</p> Signup and view all the answers

    Who is a contact person for Citibank-related inquiries?

    <p>Karishma Asrani</p> Signup and view all the answers

    What is the SEBI Registration No. for HSBC Securities and Capital Markets?

    <p>INM000010718</p> Signup and view all the answers

    What is the primary purpose of the introductory content provided?

    <p>To give contact information and procedures for redressal</p> Signup and view all the answers

    Which website is listed for Morgan Stanley?

    <p><a href="http://www.morganstanley.com">www.morganstanley.com</a></p> Signup and view all the answers

    What type of issues can be reported using the provided email addresses?

    <p>Concerns about non-receipt of funds</p> Signup and view all the answers

    What proportion of the robust fundraising came from retail investors?

    <p>Three fourths</p> Signup and view all the answers

    Which trend has historically been observed in relation to Tata Sons' balance sheet leverage ratio?

    <p>Low leverage ratios correspond with increased equity investment</p> Signup and view all the answers

    What has driven capital expenditure in recent years?

    <p>Government involvement</p> Signup and view all the answers

    What has been the general trend regarding private players' participation in capital expenditure?

    <p>Less participation compared to previous years</p> Signup and view all the answers

    What is indicated by the context regarding market performance?

    <p>Large IPOs have a negative impact on market performance</p> Signup and view all the answers

    Which factor appears to influence the equity investment pace in Tata Sons' ventures?

    <p>Balance sheet leverage ratio</p> Signup and view all the answers

    What can be inferred about the fundraising figure mentioned?

    <p>It represents a significant amount with portions from multiple sources</p> Signup and view all the answers

    What does the content suggest about the capital market trends this year?

    <p>They have been heavily influenced by government actions</p> Signup and view all the answers

    Study Notes

    ASBA

    • ASBA stands for Applications Supported by Blocked Amount.
    • An ASBA account allows investors to apply for public issues by blocking the required funds in their bank account.
    • ASBA is mandatory for public issues, and no cheques will be accepted.

    Price Band Justification

    • The price band is justified by quantitative factors and KPIs.
    • These factors and KPIs are disclosed in the "Basis for Offer Price" section of the RHP.
    • The weighted average cost of acquisition of primary and secondary transactions are also disclosed in the "Basis for Offer Price" section.

    Investor Information

    • Investors should rely on the information in the Red Herring Prospectus (RHP) and the terms of the offer.
    • External sources of information about the offer should be disregarded.
    • Investors should only refer to the price band advertisement and shouldn't rely on any media articles or reports about the valuation of the company.

    Risk to Investors

    • The company depends on HMC, its promoter, for operations, including parts and materials.
    • The company may have to pay a royalty fee to HMC.
    • Any increase in the royalty fee could impact the company's profits.

    Price Band Changes

    • If the price band is revised, the Bid/Offer Period will be extended for at least three working days.
    • The total Bid/Offer Period won't exceed 10 working days.
    • The revised price band and Bid/Offer Period will be notified to the stock exchanges, BRLMs, designated intermediaries, and sponsor banks.

    PAN-Aadhaar Linking

    • Investors must ensure their PAN is linked with Aadhaar.
    • This is in compliance with the Central Board of Direct Taxes (CBDT) notification dated February 13, 2020.

    Company Objects

    • The company's main objects can be found in the "History and Certain Corporate Matters" section of the RHP.
    • The Memorandum of Association of the company is a material document for inspection in relation to the offer.

    Material Contracts and Documents

    • For details on material contracts and documents, see the "Material Contracts and Documents for Inspection" section of the RHP.

    Liability of Company Members

    • The company is limited by shares.

    Investor Grievances

    • Investors can contact the company's investor grievance email address: [email protected]

    Availability of the RHP

    • Investors should refer to the RHP and the "Risk Factors" section before applying in the offer.
    • A copy of the RHP is available on the company's website.

    BRLMs

    • The BRLMs for this offering are:
      • Kotak Mahindra Capital Company Limited
      • Citigroup Global Markets India Private Limited
      • HSBC Securities and Capital Markets (India) Private Limited
      • J.P. Morgan India Private Limited
      • Morgan Stanley India Company Private Limited
      • KFin Technologies Private Limited
      • Sharekhan Ltd.
      • SMC Global Securities Ltd.
      • Viren M Shah
      • YES Securities (India) Limited

    Institutional Rule

    • The offer was made through the Book Building Process.

    Funding

    • The IPO raised approximately ₹33,772 crore via fresh share sales.
    • Retail investors contributed approximately three-fourths of the funds raised.

    Tata Sons Balance Sheet Leverage

    • There is a correlation between Tata Sons balance sheet leverage and the pace of its equity investment in various ventures.
    • A low leverage ratio has been followed by a surge in Tata Sons' equity investments in listed and unlisted ventures.

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    Description

    This quiz covers critical concepts related to ASBA (Applications Supported by Blocked Amount) and the justification of price bands in public issues. Learn about the investor information required for public offers, including reliance on the Red Herring Prospectus (RHP) and awareness of inherent risks. Test your knowledge on these essential topics for savvy investment decisions.

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