Indian companies are increasingly looking at alternative means of raising capital. In the past few years, the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI) have taken significant steps to expand the country’s debt market, which is less developed than the equity markets.
One such initiative is to allow foreign debt infusions in Indian companies through non-convertible debentures (NCDs). This has become a popular route for Indian companies to raise capital from overseas investors.
The provisions relating to issuance of debentures under the Companies Act, 1956, apply equally to NCDs. In addition, the issuance of NCDs could be treated as an issuer company accepting a “deposit” under the Companies Act. However, NCDs are typically issued in a manner that allows the issuer company to benefit from certain exemptions under the Companies (Acceptance of Deposits) Rules, 1976.
You must be a
subscribersubscribersubscribersubscriber
to read this content, please
subscribesubscribesubscribesubscribe
today.
For group subscribers, please click here to access.
Interested in group subscription? Please contact us.
你需要登录去解锁本文内容。欢迎注册账号。如果想阅读月刊所有文章，欢迎成为我们的订阅会员成为我们的订阅会员。
Ganesh Prasad is a partner and Sharad Moudgal is a principal associate at Khaitan & Co. The views of the authors are personal, and should not be considered as those of the firm.
Simal, 2nd Floor
7/1 Ulsoor Road
Bangalore 560 042 – India
Tel: +91 80 4339 7000
Fax: +91 80 2559 7452
Email: bangalore@khaitanco.com
Bangalore | Kolkata | Mumbai | New Delhi
