CS Professional · Strategic Management and Corporate Finance · Role of Intermediaries in Fund Raising
In a public issue of shares by an Indian company, which of the following is a core function of the Registrar to an Issue?
The Registrar to an Issue handles the allotment process: it reconciles applications, finalises the basis of allotment with the designated stock exchange, and processes refunds and credit of shares. Underwriting, pricing and monitoring of proceeds belong to other intermediaries, not the registrar.
- AUnderwriting the unsubscribed portion of the issue
- BFinalising the basis of allotment in consultation with the designated stock exchange and processing refunds and credit of sharesCorrect
- CFixing the price band of the issue on its own
- DActing as the monitoring agency for utilisation of issue proceeds
Explanation
The Registrar to an Issue handles the application and allotment process: it collects and reconciles application data, helps finalise the basis of allotment with the designated stock exchange, and processes unblocking or refunds and credit of securities. Underwriting is done by underwriters, price band is fixed by the issuer with the book running lead managers, and monitoring is done by an eligible agency such as a bank.
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