NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Introduction to the Securities Market
Which of the following statements about a Qualified Institutional Placement (QIP) of a listed company is correct?
A QIP is an issue of eligible securities by a listed company only to qualified institutional buyers. It is a quicker primary market fundraising route than a public offer, and it is not meant for retail investors or unlisted companies.
- AIt is an issue of securities only to qualified institutional buyers by a listed companyCorrect
- BIt is an issue made only to retail investors
- CIt can be made by an unlisted company for its first listing
- DIt is a secondary market purchase by institutions
Explanation
A QIP is a fund-raising route in which a listed company issues eligible securities to qualified institutional buyers only, without a lengthy prospectus process. It is not for retail investors or unlisted companies, and it is a primary issue, not a secondary market purchase.
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