HLF Ltd, a real estate company which was formed in 1959. In about 56 years of its existence, the company has managed to carve out a niche for itself in this sector. Lately, this sector is witnessing a boom due to the fact that the Indian economy is on a rise. The incomes of the middle class are rising. More people can afford to buy homes for themselves due to the easy availability of loans and accompanying tax concessions. To expand its business in India and abroad the company is weighing various options to raise money through equity offerings in India. Whether to tap equity or debt market? Whether to raise money from the domestic market or international market or a combination of both? The company wants to raise the necessary finance from the money market or capital market. It is also planning to list itself in New York Stock Exchange to raise money through ADRs. To make its offerings attractive it is planning to offer a host of financial plans products to its stakeholders and investors and also expand its listing at NSE after complying with the regulations of SEBI.

(i) What benefits will the company derive from listing at NSE?

(ii) What are the regulations of SEBI that the company must comply with?

(iii) How does the SEBI exercise control over FLF Ltd. in the interest of the investors?

Open in App

Solution

(i) Benefits from listing at NSE of HLF Ltd are :

(a) It will ensure that all investors will have equal access to investing in FLF Ltd. through an appropriate network.

(b) It will provide fair, efficient and transparent securities market to the investor through an electronic trading platform and meet the current international standards securities market.

(ii) The regulations of SEBI that the company must comply with are :

(a) HLF Ltd. should avoid fraudulent and unfair trade practices.

(b) They need to follow the code of conduct formulated by SEBI.

(iii) SEBI exercises control over HLF Ltd. by :

(a) Performing and exercising powers under the Securities Contracts (Regulation) Act, 1956 as having been delegated to it by the Government of India.

(b) Notifying rules and regulations for smooth functioning in the market and regulating the workings of the market.

Suggest Corrections

Similar questions

‘R’ Limited is a real estate company which was formed in 1950. In about 56 years of its existence the company has managed to carve out a niche for itself in this sector. Lately, this sector is witnessing a boom due to the fact that the Indian economy is on the rise. The incomes of middle class are rising. More people can afford to buy homes for themselves due to easy availability of loans and accompanying tax concessions.

To expand its business in India and abroad the company is weighing various options to raise money through equity offerings in India. Whether to tap equity or debt. market whether to raise money from domestic market or international market or Combination of both? Whether to raise the necessary finance from money market or capital market. It is also planning to list itself in New York Stock Exchange to raise money through ADR’s. To make its offerings attractive it is planning to offer host of financial plans products to its stakeholders and investors and also expand it’s listing at NSE after complying with the regulations of SEBI.

(i) What benefits will the company derive from listing at NSE?
(ii) What are the regulations of SEBI that the company must comply with?
(iii) How does the SEBI exercise control over ‘R’ Limited in the interest of investors?

R Ltd is a real estate company which was formed in 1950. In about 56 years of its existence, the company has managed to carve out a niche for itself in this sector. Lately, this sector is witnessing a boom due to the fact that the Indian economy is on the rise. The incomes of the middle class are rising. More people can afford to buy homes for themselves due to the easy availability of loans and accompanying tax concessions.

To expand its business in India and abroad, the company weighs various options to raise money through equity offerings in India. Whether to tap equity or debt market, whether to raise money from domestic market or international market or combination of both? When to raise the necessary finance from the money market or capital market? It is also planning to list itself in New York Stock Exchange to raise money through ADRs. To make its offerings attractive, it is planning to offer the host of financial plans and products to its stakeholders and investors and also expand its listing at NSE after complying with the regulations of SEBI.

What are the regulations of SEBI that the company must comply with?

R Ltd is a real estate company which was formed in 1950. In about 56 years of its existence, the company has managed to carve out a niche for itself in this sector. Lately, this sector is witnessing a boom due to the fact that the Indian economy is on the rise. The incomes of middle class are rising. More people can afford to buy homes for themselves due to easy availability of loans and accompanying tax concessions.

How does the SEBI exercise control over 'R' Ltd in the interest of investors?

Q. Bandhu Limited is a real estate company, which was formed in

1960

. In about

55

years of its existence, the company has managed to carve out a niche for itself in this sector. In order to establish itself in India, the company decided to list its securities on BSE, in order to raise money through India market.
State the functions performed by SEBI that make investors comfortable and secured in dealing with Bandhu Ltd.

Q. A company ‘M’ limited is manufacturing mobile phones both for domestic Indian market as well as for export. It had enjoyed a substantial market share and also had a loyal customer following. But lately it has been experiencing problems because its targets have not been met with regard to sales and customer satisfaction. Also mobile market in India has grown tremendously and new players have come with better technology and pricing. This is causing problems for the company. It is planning to revamp its controlling system and take other steps necessary to rectify the problems it is facing.

Questions

1. Identify the benefits the company will derive from a good control system.

2. How can the company relate its planning with control in this line of business to ensure that its plans are actually implemented and targets attained.

3. Give the steps in the control process that the company should follow to remove the problems it is facing.

4. What techniques of control can the company use? In all the answers keep in mind the sector of business the company is in.

Join BYJU'S Learning Program