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Last updated: 2 October 2026
Before a merchant banker files a draft red herring prospectus, the company’s records, capital structure and shareholding have to stand up to SEBI ICDR scrutiny. Expertvuw supports the readiness and secretarial workstream, while the book running lead manager (BRLM) leads the issue itself.
A main board initial public offer is governed by Chapter II of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018. An issuer either meets the track-record tests in Regulation 6(1), covering net tangible assets, average operating profit and net worth over the preceding three years, or uses the alternative route in Regulation 6(2), under which at least 75% of the net offer must be allotted to qualified institutional buyers through book building.
Most delays in an IPO timeline start well before the offer document. Gaps in allotment records, missing ROC forms, shares still held in physical form, unclear promoter group identification and convertible instruments that must be converted before filing all surface during the merchant banker’s due diligence.
Expertvuw works with the promoters and the company’s merchant banker to close these gaps early: reviewing statutory registers and filings from incorporation, reconciling the capital history, planning conversion to a public company, dematerialising holdings and mapping promoter contribution and lock-in. Certifications that the law reserves for practising professionals are obtained through independent licensed professionals, and the issue itself is managed by the BRLM.
Based on the regulations and circulars referred to on this page. Last updated: 28 September 2026.
Average operating profit of at least ₹15 crore over the preceding three years (ICDR Reg 6(1)(b))
Net tangible assets of ₹3 crore and net worth of ₹1 crore in each of the preceding three years (Reg 6(1))
Issuers not meeting Reg 6(1) must allot at least 75% of the net offer to QIBs (Reg 6(2))
Promoters must hold at least 20% of post-issue capital (Reg 14(1))
Minimum contribution locked for 18 months, excess for six months; longer where proceeds fund capital expenditure (Reg 16)
Entire pre-issue capital held by non-promoters locked in for six months, subject to listed exceptions (Reg 17)
These issues tend to surface during the merchant banker’s due diligence, when fixing them is slowest.
Missing allotment forms, board minutes or share transfer records make it hard to support every line of the capital build-up.
Convertible securities and physically held promoter shares generally have to be resolved before the draft offer document is filed.
Shares acquired recently at a lower price, for non-cash consideration or under pledge may not count towards minimum promoter contribution.
Related services.
Listing on the SME platform of NSE or BSE under ICDR Chapter IX.
Conversion under the Companies Act, usually the first step before an IPO.
Ongoing SEBI LODR obligations once the shares are listed.
PIT code, structured digital database and trading window set-up.
We review financials and records against ICDR eligibility and general conditions to identify gaps.
Capital history, registers and missing ROC filings are reconciled, with regularisation steps listed where needed.
Conversion to public company, board composition and AOA changes are planned and documented.
Convertibles, partly paid shares and physical holdings are addressed and holdings moved to demat form.
Promoter group, eligible shares for minimum contribution and likely lock-in positions are tabulated.
A structured data room supports the merchant banker's due diligence and offer document drafting.
Listing brings a continuing disclosure and governance regime alongside the lock-in schedule.
Quarterly filings, board committee requirements and event disclosures under SEBI LODR Regulations 2015 apply from listing.
Promoter and pre-issue lock-ins expire on different dates and need to be tracked for each shareholder.
A code of conduct, trading window and structured digital database are needed under SEBI PIT Regulations 2015.
Acquisitions and encumbrances crossing SAST thresholds trigger disclosures to the stock exchanges.
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The issue is managed by a SEBI-registered merchant banker acting as book running lead manager. Expertvuw supports readiness, secretarial and documentation work and coordinates with the BRLM, legal counsel and auditors appointed by the company.
ICDR Regulation 6(2) allows an issuer to proceed through book building if at least 75% of the net offer is allotted to qualified institutional buyers. Additional limits then apply to shares offered for sale by existing shareholders.
Yes. A private company converts to a public company under the Companies Act, 2013, with changes to its articles and board structure, before the offer document is filed.
Regulation 15 excludes certain shares, such as those acquired in the preceding three years for non-cash consideration, recent acquisitions below the issue price and pledged shares. The eligible pool is worked out early.
It depends on the state of the records and the restructuring needed. Companies with complete registers and demat holdings typically move faster than those needing reconstruction of past filings.
ACS – Director, Expertvuw Management Pvt Ltd
Advisory and company secretarial work is handled by Expertvuw’s team. Audits, certifications and representation that the law reserves for Chartered Accountants, advocates or other licensed professionals are provided by independent professionals engaged for your case.