Framework for listing of Commercial Paper - SEBI - SEBI/HO/DDHS/DDHS/CIR/P/2019/115

CIRCULAR SEBI/HO/DDHS/DDHS/CIR/P/2019/115 October 22, 2019 To Issuers who intend to list their Commercial Papers All Recognized Stock Exchanges Dear Sir / Madam, Subject: Framework for listing of Commercial Paper 1. The issuers of Commercial Papers (CPs) have shown interest to list CPs for trading on Stock Exchange(s) with a view to broadening investor participation in CPs. Accordingly, to enable listing of CPs and to ensure investor protection, it is important that issuers make appropriate disclosures at the time of listing and on a continuous basis. 2. In view of the above, a disclosure framework applicable for listing of CPs was discussed in the meeting of Corporate Bonds Securitization Advisory Committee (CoBoSAC), chaired by Shri H. R. Khan. 3. Based on recommendations of CoBoSAC, for listing of CPs, issuers and stock exchanges shall comply at the time of listing and on a continuous basis with the following; a. An issuer who desires to list its CP shall forward an application for listing along with the disclosures specified in Annexure I to the concerned stock exchange(s). b. On approval of the listing application by the concerned stock exchange(s), the disclosures so provided along with the application for listing, shall be made available on the website of the concerned stock exchange(s). c. Post listing, the issuer shall make disclosures, as specified in Annexure II , during the tenure of the CP(s) to the concerned stock exchange(s), which in turn shall disseminate the same on its website. 4. The Stock exchange(s) are advised to put in place; a. Necessary systems and procedures for monitoring of disclosures as specified in Annexure I II of this circular. b. A framework for imposition of fine, in case of non-compliance and/ or inappropriate disclosures by issuers. 5. Any non-compliance with the conditions of listing issued under this circular may also attract action under Securities and Exchange Board of India Act, 1992. 6. This Circular is issued in exercise of powers conferred under Section 11(1) of Securities and Exchange Board of India Act, 1992 . 7. This Circular is available on SEBI website at www.sebi.gov.in under the categories Legal Framework and under the drop down Corporate Debt Market . Yours faithfully, Richa G. Agarwal Deputy General Manager Department of Debt and Hybrid Securities Tel No.022-2644 9596 Email id - [email protected] Annexure I Disclosures to be provided along with the application for listing 1. Issuer details: 1.1. Details of the issuer: (i) Name, Address, CIN and PAN (ii) Line of business (iii) Chief Executive (Managing Director / President/ CEO / CFO) (iv) Group affiliation (if any). 1.2. Details of the directors: Name, designation and DIN Age Address Director since List of other directorships 1.3. Details of change in directors in last three financial years including any change in the current year: Name, designation and DIN Date of appointment/ resignation Date of cessation (in case of resignation) Remarks(viz. reasons for change etc) 1.4. List of top 10 holders of equity shares of the company as on date or the latest quarter end: S.no Name and category of shareholder Total no. of equity shares No of shares in demat form Total shareholding as % of total no. of equity shares 1.5. Details of the statutory auditor: Name and address Date of appointment Remarks 1.6. Details of the change in statutory auditors in last three financial years including any change in the current year: Name, address Date of appointment/ resignation Date of cessation (in case of resignation) Remarks (viz. reasons for change etc) 1.7. List of top 10 debt securities holders (as on .): S. No. Name of holder Category Face value Holding of debt securities as a percentage of total debt securities outstanding of the issuer 1.8. List of top 10 CP holders (as on .): S. No. Name of CP holder Category of CP holder Face value of CP holding CP holding percentage as a percentage of total CP outstanding of the issuer 2. Material Information: 2.1. Details of all default/s and/or delay in payments of interest and principal of CPs, (including technical delay), debt securities, term loans, external commercial borrowings and other financial indebtedness including corporate guarantee issued in the past 5 financial years including in the current financial year. 2.2. Ongoing and/or outstanding material litigation and regulatory strictures, if any. 2.3. Any material event/ development having implications on the financials/credit quality including any material regulatory proceedings against the Issuer/promoters, tax litigations resulting in material liabilities, corporate restructuring event which may affect the issue or the investor s decision to invest / continue to invest in the CP. 3. Details of borrowings of the company, as on the latest quarter end: 3.1. Details of debt securities and CPs: Series ISIN Tenor/ Period of maturity Coupon Amount issued Date of allotment Redemption date/ Schedule Credit rating Secured/ Unsecured Security Other Details viz. Details of IPA, Details of CRA 3.2. Details of secured/ unsecured loan facilities/ bank fund based facilities/ rest of the borrowing, if any, including hybrid debt like foreign currency convertible bonds (FCCB), optionally convertible debentures / preference shares from banks or financial institutions or financial creditors, as on last quarter end: Lender s name/ Name of the Bank Nature of facility/ instrument Amount sanctioned Principal Amount outstanding Repayment date / schedule Security, if applicable Credit rating, if applicable Asset classification 3.3. The amount of corporate guarantee or letter of comfort issued by the issuer along with name of the counterparty (like name of the subsidiary, JV entity, group company, etc) on behalf of whom it has been issued, contingent liability including debt service reserve account (DSRA) guarantees/ any put option etc. 4. Issue Information: 4.1. Details of current tranche including ISIN, amount, date of issue, maturity, all credit ratings including unaccepted ratings, date of rating, name of credit rating agency, its validity period (details of credit rating letter issued not older than one month on the date of opening of the issue), details of issuing and paying agent and other conditions, if any. 4.2. CP borrowing limit, supporting board resolution for CP borrowing, details of CP issued during the last 15 months. 4.3. End-use of funds. 4.4. Credit Support/enhancement (if any): (i) Details of instrument, amount, guarantor company (ii) Copy of the executed guarantee (iii) Net worth of the guarantor company (iv) Names of companies to which guarantor has issued similar guarantee (v) Extent of the guarantee offered by the guarantor company (vi) Conditions under which the guarantee will be invoked 5. Financial Information: 5.1. Audited / Limited review half yearly consolidated (wherever available) and standalone financial information (Profit Loss statement, Balance Sheet and Cash Flow statement) along with auditor qualifications, if any, for last three years along with latest available financial results. In case an issuer is required to prepare financial results for the purpose of consolidated financial results in terms of Regulation 33 of SEBI LODR Regulations, latest available quarterly financial results shall be filed. 5.2. Latest audited financials should not be older than six month from the date of application for listing. Provided that listed issuers (who have already listed their specified securities and/or Non-convertible Debt Securities (NCDs) and/or Non-Convertible Redeemable Preference Shares (NCRPS)) who are in compliance with SEBI (Listing obligations and disclosure requirements) Regulations 2015 (hereinafter SEBI LODR Regulations ), may file unaudited financials with limited review for the stub period in the current financial year, subject to making necessary disclosures in this regard including risk factors. 6. Asset Liability Management (ALM) Disclosures: 6.1. NBFCs seeking to list their CPs shall make disclosures as specified for NBFCs in SEBI Circular nos. CIR/IMD/DF/ 12 /2014, dated June 17, 2014 and CIR/IMD/DF/ 6 /2015, dated September 15, 2015, as revised from time to time. Further, Total assets under management , under para 1.a. of Annexure I of CIR/IMD/DF/ 6 /2015, dated September 15, 2015 shall also include details of off balance sheet assets. 6.2. HFCs shall make disclosures as specified for NBFCs in SEBI Circular no. CIR/IMD/DF/ 6 /2015, dated September 15, 2015, as revised from time to time with appropriate modifications viz. retail housing loan, loan against property, wholesale loan - developer and others. Annexure II Continuous obligations and disclosure requirements for listed CPs: 1. Financial results: 1.1. Issuers who have listed their specified securities and are required to comply with provisions of Chapter IV of SEBI LODR Regulations and also have outstanding listed CPs shall prepare and submit financial results in terms of Regulation 33 of SEBI LODR Regulations and additional line items as required under Regulation 52(4) of SEBI LODR Regulations. 1.2. Issuers who have listed NCD s, NCRPS or both and are required to comply with provisions of Chapter V of SEBI LODR Regulations and also have outstanding listed CPs or who only have outstanding listed CPs shall prepare and submit financial results in terms of Regulation 52 of SEBI LODR Regulations. However, if an issuer is required to prepare financial results for the purpose of consolidated financial results in terms of Regulation 33 of SEBI LODR Regulations, then such issuers, shall prepare and submit financial results in terms of para 1.1. above. 2. Material events or Information: The issuer shall disclose the following details to the stock exchange(s) as soon as possible but not later than 24 hours from the occurrence of event (or) information: 2.1. Details such as expected default/ delay/ default in timely fulfilment of its payment obligations for any of the debt instrument; 2.2. Any action that shall affect adversely, fulfilment of its payment obligations in respect of CPs; 2.3. Any revision in the credit rating; 2.4. A certificate confirming fulfilment of its payment obligations, within 2 days of payment becoming due. 3. Issuers who are NBFCs/HFCs, shall simultaneously submit to the stock exchanges the latest ALM statements as and when they submit the same to respective regulator(s) viz RBI/NHB, as applicable. 4. A certificate from the CEO/CFO to the recognized stock exchange(s) on quarterly basis certifying that CP proceeds are used for disclosed purposes, and adherence to other listing conditions, as specified in Annexure I.