CS Inter :: Securities Laws and Regulation of financial markets : December 2005

Roll No…………………
Time allowed : 3 hours Maximum marks : 100
Total number of questions : 8 Total number of printed pages : 3
 
NOTE : Answer SIX questions including Question No.1 which is compulsory.
 
1. Write notes on any four of the following:
(i)Capital indexed bonds
(ii)Unique identification number
(iii)Sweat equity shares
(iv)Whistle blower policy
(v)Capital market vis-a-vis money market.
(5 marks each)
2. (a) Define ‘Ombudsman’. What are his powers and functions under the SEBI (Ombudsman) Regulations, 2003?
(5 marks)
(b) Define any five of the following:
(i)Asset Management Company (AMC)
(ii)Exchange Traded Fund (ETF)
(iii)Foreign Currency Convertible Debenture (FCCD)
(iv)National Securities Clearing Corporation Ltd. (NSCCL)
(v)American Depository Receipt (ADR)
(vi)Market makers.
(1 mark each)
(c) Distinguish between any three of the following:
(i)‘Foreign direct investment’ and ‘foreign institutional investment’.
(ii)Front-end load’ and ‘back-end load’.
(iii)‘Dematerialisation’ and ‘re-materialisation’.
(iv)French auction’ and ‘Dutch auction’.
(2 marks each)
3. (a) "All issuer companies shall submit secretarial audit report on a quarterly basis to the stock exchanges, where they are listed." Discuss the statement outlining the various aspects covered under the secretarial audit.
(5 marks)
(b) Discuss the eligibility criteria for voluntary de-listing of shares.
(5 marks)
(c) Highlight the provisions relating to the following as applicable to NBFCs:
(i)Loans against deposits,
(ii)Ceilings on interest rate.
(3 marks each)
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4. (a) State the norms prescribed for registration as portfolio managers.
(5 marks)
(b) State briefly the major contents of the ‘offering circular for euro issues’.
(5 marks)
(c) "Credit rating is a one-time job on the part of credit rating agencies." Comment in the light of the SEBI regulations.
(4 marks)
5. (a)

Vikrant Enterprises Ltd. has decided to acquire stake upto 25% of the paid-up share capital of Global Exims Ltd., which is a listed company and wants to proceed with a public offer pursuant to the provisions of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997. Prepare a Board note highlighting the general obligations of Vikrant Enterprises Ltd.
(10 marks)
(b) Calculate the value of rights, if—
(i)
(ii)
(iii)
(iv)
(v)		 Number of rights shares offered
Number of shares held
Ex-rights price
Rights offer price
Face value of shares		 7,500
2,500
Rs.20
Rs.12
Rs.10
(6 marks)
6. (a) Explain the concept of ‘connected person’ under the SEBI (Prohibition of Insider Trading) Regulations, 1992.
(5 marks)
(b) Write a note on ‘due diligence’ in the process of public issue of securities.
(5 marks)
(c)

Discuss briefly the provisions of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Markets) Regulations, 2003 with regard to ‘prohibition of manipulative, fraudulent and unfair trade practices’.
(8 marks)
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7. (a) Describe the issue process of gilt-edged securities.
(8 marks)
(b) State briefly the provisions of the Employees Stock Purchase Scheme (ESPS) relating to
(i)
(ii)		 Eligibility to participate in the scheme; and
Pricing and lock-in period.
(4 marks)
(c) With reference to derivative trading, explain any two of the following:
(i)
(ii)
(iii)		 Out of the money
Call option
Strike price.
(2 marks each)
8. (a) What is ‘book building’? Discuss the guidelines issued by the SEBI for raising capital by 100% book building process.
(10 marks)
(b) What is the concept of ‘buy-back of securities’? Discuss the various permissible methods of buy-back of securities by a listed company.
(6 marks)
__________

 

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