The company may/have to go for capital reduction when it has

• substantial accumulated losses and part of the capital is permanently eroded
• surplus cash which it wants to distribute to its shareholders
• no need to raise balance calls on partly paid shares

We advise client to arrive at the right size, timing and tax optimum structure for shareholders after in depth analyse of the balance sheet along with the future projections and business plan and other long term objectives. Our team will execute the selected option either as pure reduction (Section 66 of the Companies Act, 2013) or even by way of a scheme of arrangement as may be appropriate

We advise buy back to cash rich companies where management wants to

• Give exit option to some shareholders
• Distribute surplus cash not required by business
• Increase promoters holding
• Support share value
• Prevent takeover bid

Section 68, 69 and 70 of the Companies Act 2013 and Rule 17 of Companies (Share Capital and Debentures) Rules, 2014 deals with buyback. Here, we advise them on the appropriate size, timing, procedure and compliances.

We advise this option when the company wants to

• Raise additional capital by equity shares without diluting control of the existing ordinary shares
• Satisfy the need of retail investors who do not bother much about voting rights, but are more concern about dividend and returns.

Section 68, 69 and 70 of the Companies Act 2013 and Rule 17 of Companies (Share Capital and Debentures) Rules, 2014 deals with buyback. Here, we advise them on the appropriate size, timing, procedure and compliances.

Note: Only a private company can issue non-voting equity shares. (intepretation of various sections of Companies Act, 2013)

We understand the strategic objectives of the management and based on this we advise them on size, timing, compliances and process of issue and once agreed we help execute the agreed issue.

Similar to non-voting equity shares in some respects, we advise this option when

• Voting rights are not to be diluted
• For funding large projects, as fewer voting rights in an issue do not trigger open offer
• Hostile takeover is to be prevented
• There are strategic investors who are looking for a reasonably big investment but not the control in the company
• Higher dividends over voting rights are preferred

We understand the strategic objectives of the management and based on this we advise them on size, timing and process of issue and once agreed we help execute the agreed issue.

Human resources are the most important asset for any organization. We advise this option to

• Attract, retain, motivate and incentivize employees
• Give them a sense of ownership and to encourage them to participate actively in the management of the company

We understand the importance of human resources in the company and based on this we advise them on size, timing, conditions, valuation and process of issue and once agreed we help execute the agreed issue.

We suggest this for reasons similar to ESOP but for employees in exchange for providing know how/rights or other value addition.

We understand the importance of human resources in the company and based on this we advise them on size, timing, valuation and process of issue and once agreed we help execute the agreed issue.

We suggest this option when the company wants to reward its employees for financial growth. This is similar to ESPP but here employees do not have to purchase anything and the incentive is in the form of cash.

We suggest this option when the company wants to reward its employees for financial growth. This is similar to ESPP but here employees do not have to purchase anything and the incentive is in the form of cash.

We recommend share split when

• There are indications that the company’s share price levels are too high in comparison to its peers.
• Shares are to be made more affordable and liquid for small investors enhancing its shareholder base without changing its underlying value.

We understand the strategic objectives of the management and advise them on size, timing, ratio, process and probable effect of the split and once agreed we help them execute the agreed share split.

We advise this option

• Make investing in shares more attractive to a broader range of institutional and professional investors who may have a mandate to only invest in shares above a certain price point.
• Meet the minimum trading bid size to ensure its listing status on the stock exchange.
• Reducing the volatility of the stock
• Increasing the trading share price.

We explain to the management the pros and cons for this option and its probable effect. We understand the strategic objectives of the management and based on this we advise them on size, timing, ratio and process of consolidation and once agreed we help execute it.

We suggest convertible debentures when the company

• Has long gestation period and
• Has risky projects requiring small interest burden at the beginning and
• Is unable to raise fund through Equity.
• Wants to delay dilution of control in the company.

Here, we understand the business model of the company and future plans of the management and based on this we analyse the risk return profile and advise them on size, timing, conversion ratio, price and process of issue and once agreed we help execute it.

We advise to opt for preferential allotment when

• It is not preferable or feasible for a company to issue securities to the public at large
• It is too time consuming and expensive
• Certain persons want to take a strategic stake in the company

We understand the financing needs of the company and the strategic objectives of the management and advise them on process and execution of the allotment.