The Draft Red Herring Prospectus (DRHP) is a preliminary document in the IPO process for companies seeking to list on NSE SME and BSE SME stock exchanges of India.
To be eligible to file a DRHP, a company must meet the specific IPO eligibility criteria laid by SEBI for SME exchanges including minimum net worth, profitability benchmarks, and track record requirements.
If the company meets the eligibility criteria, with the support of experienced IPO consultants and Merchant Bankers in India, initiates the structured SME IPO Process. DRHP typically includes several sections: Company overview, Financial information of the Issuer, Issue procedure and structure, Risk factors, Details about promoters and promoter group, etc.
Cost of raising funds through SME IPO ranges from 40-50 Lakhs depending on parameters like IPO size, services used etc. Sometimes it may be lower also as every IPO is different and cost varies depending on the IPO
No, the company with a track record of 3 years is eligible for raising IPO. See Revised Eligibility Criteria.
NSE and SME stock exchanges both have the SME IPO platform. The company can be listed on either of them.
A promoter is named in DRHP or RHP and one who exercises control over a company's operations.
DRHP is a preliminary document filed by a company planning to launch an IPO. It provides important details about the company’s business, financials, and risks before the IPO is approved.
It takes a minimum 3 months for an IPO to open after filing of DRHP. The relevant stock exchanges take time to examine and approve the DRHP.
DRHPs are available on SEBI’s official website, as well as the websites of the stock exchanges (NSE, BSE) and the company’s lead managers. One may also refer ipoplatform.com for a particular company’s DRHP.
DRHP is a preliminary document whereas RHP is a final version which contains all disclosures and comments as addressed at the time of review of DRHP.
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