CS Professional · IFSCA - Regulations, Listing and Compliances · Capital Market Intermediaries
Kaveri Capital wants to carry on the business of underwriting and managing public issues of securities listed on an IFSC exchange, acting as the lead manager for a foreign company's offering. Under the IFSCA framework, in which category of capital market intermediary should it seek registration for this activity?
Kaveri Capital should register as a merchant banker. Lead managing and underwriting public issues of securities is the defining function of a merchant banker. Depository participants, clearing members and investment advisers perform custody, settlement and advisory roles respectively, not issue management.
- AMerchant bankerCorrect
- BDepository participant
- CClearing member
- DInvestment adviser
Explanation
Managing and underwriting issues of securities is the core function of a merchant banker, which acts as lead manager. A depository participant holds securities in dematerialised form, a clearing member settles trades, and an investment adviser gives advice, so none of them performs issue management.
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