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SEBI issues new format of Abridged Prospectus for public issues of Non-Convertible Debt Securities and / or Non-Convertible Redeemable Preference Shares

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Recently, SEBI released a circular revising the format for disclosure in the Abridged Prospectus for public issues of Non-Convertible Debt Securities (NCDs) and / or Non-Convertible Redeemable Preference Shares (NCRPS). The format has been revised in order to provide greater clarity and consistency in the disclosures across various documents and to provide additional but critical information in the Abridged Prospectus.

As per Regulation 2(1)(a) of SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 (“NCS Regulations”) “abridged prospectus” means a memorandum accompanying the application form for a public issue containing such salient features of a prospectus as specified by the Board. Further, in terms of Regulation 32(3) of the NCS Regulations, abridged prospectus shall be in the format as specified in Part B of Schedule I of the NCS Regulations.

A copy of the Abridged Prospectus shall be made available on the website of issuer, merchant bankers, registrar to an issuer and a link for downloading Abridged Prospectus shall be provided in issue advertisement for the public issue.

The market regulator said that the Issuer or its Merchant Bankers shall insert a Quick Response (QR) code on the last page of the Abridged Prospectus and on the front page of the documents such as front outside cover page, advertisement, etc. as deemed fit by them. The scan of the QR code would lead to the prospectus or abridged prospectus as applicable. The Issuer or its Merchant Bankers shall ensure that the disclosures in the Abridged Prospectus are adequate, accurate and do not contain any misleading or misstatement. Furthermore, the qualitative statements in the Abridged Prospectus should be substantiated with quantitative factors. Also, no qualitative statement shall be made which cannot be substantiated with quantitative factors.

This Circular shall be applicable for all public issues opening on or after October 1, 2023. The revised format is placed at Annex-I of this Circular. Further, instructions to investors for completing the application form is specified in Annex-II.

A copy of the circular is enclosed below.

Readers are welcome to send their views to Regstreet Law Advisors at info@regstreetlaw.com.

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