Forum Views - June 2024

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BOMBAY STOCK EXCHANGE BROKERS' FORUM (BBF) | MUMBAI, INDIA

JUNE 2024 | VOLUME: 13 • ISSUE NO. 3 •

I N S I D E

•

Exploring Smart Beta Investing Banking and Finance Cybersecurity Roadmap

Green Bonds & AI: Sustainable Prosperity in India Generative AI: Disruption and Skills Adaptation

Financial PR with Media Analysis Tools Nourish to Flourish

FORUM VIEWS - JUNE 2024

EXECUTIVE COMMITTEE

GOVERNING BOARD MEMBERS

BOMBAY STOCK EXCHANGE BROKERS’ FORUM (BBF)

GOVERNING BOARD 2023 - 24

FORUM VIEWS - JUNE 2024

Ajit Sanghvi

MSS Securities

Pvt. Ltd.

Cyrus Khambata

Paytm

Money Ltd.

Ashish Rathi

HDFC

Securities Ltd.

Kamlesh Jhaveri

Jhaveri

Securities Ltd.

Ketan Marwadi

Marwadi Shares

& Finance Ltd.

Rajiv Kejriwal

SBICAP

Securities Ltd.

Purav Fozdar

Axiom Share

Broking Pvt. Ltd.

Neeraj Choksi

NJ India

Invest Pvt. Ltd.

Parth Nyati

Swastika

Investmart Ltd.

Dr. Pravin Bathe

Angel

One Ltd.

Kranthi Bathini

WealthMills

Securities Pvt. Ltd.

Vivek Gupta

GEPL Capital

Pvt. Ltd.

Virender Mansukhani

Mansukh Securities

and Finance Ltd.

Uttam Bagri

BCB Brokerage

Pvt. Ltd.

Tejas Khoday

Fyers Securities

Pvt. Ltd.

KISHOR KANSAGRA

Chairman | BBF

Pragya

Securities Pvt. Ltd.

KUSHAL SHAH

Jt. Secretary | BBF

Ratnakar

Securities Pvt. Ltd.

RAJIV CHOKSEY

Treasurer | BBF

KR Choksey Shares

& Securities Pvt. Ltd.

ANURAG BANSAL

Vice Chairman | BBF

SMC Global

Securities Ltd.

NIRAV GANDHI

Secretary | BBF

JM Financial

Services Ltd.

Saurabh Jain

SSJ Finance &

Securities Pvt. Ltd.

S. P. Toshniwal

Sunlight

Broking LLP

Roopkishor Bhootra

Anand Rathi Shares &

Stock Brokers Ltd.

Santosh Jayaram

GROWW

Shripal Shah

Kotak

Securities Ltd.

Ajay Kejriwal

Choice Equity

Broking Pvt. Ltd.

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FORUM VIEWS - JUNE 2024

Your

Questions

Answered

EXPLORING SMART BETA INVESTING

AN OVERVEW OF SEBI’s TAKEOVER REGULATIONS

BBF Steering Committee

Kishor Kansagra (Chairman)

Anurag Bansal (Vice Chairman)

Nirav Gandhi (Secretary)

Rajiv Choksey (Treasurer)

Kushal Shah (Jt. Secretary)

Concept, Production and Editorial: Dr. Vispi Rusi Bhathena, PhD (h.c.)

Publisher Name: Dr. V Aditya Srinivas | Nationality: Indian

Address: BSE Brokers Forum, 808-A, 8th floor, P.J. Towers, Dalal Street, Fort, Mumbai - 400001. Maharashtra

Printer Name: Dr. V Aditya Srinivas | Nationality: Indian

Address: BSE Brokers Forum, 808-A, 8th floor, P.J. Towers, Dalal Street, Fort, Mumbai - 400001. Maharashtra

Editor Name: Dr. V Aditya Srinivas | Nationality: Indian

Address: BSE Brokers Forum, 808-A, 8th floor, P.J. Towers, Dalal Street, Fort, Mumbai - 400001. Maharashtra

Place of Publication: BSE Brokers Forum, 808-A, 8th floor, P.J. Towers, Dalal Street, Fort, Mumbai - 400001.

Maharashtra

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Maharashtra

Design & Layout: Harshad Gajera

11 Insights

NEXT-GEN FINANCING: GREEN BONDS ENHANCED

BY AI FOR SUSTAINABLE PROSPERITY IN INDIA

DIGITAL SAFEGUARDS: A ROADMAP FOR

CYBERSECURITY IN BANKING AND FINANCE

20 Feature

ADAPTING TO THE RISE OF GENERATIVE AI

HOW AI IS BOTH DISRUPTING HOW WE WORK AND

ENABLING THE SKILLS-BASED ORGANIZATION

FINANCIAL SERVICES HOUSE CAN IMPROVE PR

BY USING MEDIA ANALYSIS TOOL

THE INDIAN PARTNERSHIP ACT 1932

COMPLIANCE CALENDAR

Regulatory

Compliance

Leadership,

Empowerment

& Lifestyle

NOURISH TO FLOURISH -

ON A BALANCED VEGAN DIET

INNOVATION AND THE SMALL SCALE PARADIGM:

A HUGE IMPERATIVE

Dr. Vispi Rusi Bhathena, PhD (h.c.)

Chief Executive Officer

Dr. V. Aditya Srinivas

Chief Operating Officer

and Chief Economist

India’s Economic Landscape: Navigating Reform and Growth

As the anticipation builds around impending election results, India finds itself at a pivotal moment of economic

transformation. The nation, often hailed as a torchbearer for the global economy, is on the brink of

implementing significant reforms poised to reshape its economic trajectory.

Anticipated Economic Reforms: With the ball set for the election results, India braces itself for a wave of

transformational reforms. These reforms carry the weight of lofty aspirations, aiming to propel India towards

the ambitious goal of a $10 trillion economy. Such reforms, if realized, hold the promise of positioning India as

a formidable force in the global economic arena.

F R O M

T H E

BBF SECRETARIAT

Historical GDP Performance: Reflecting on the past two decades unveils a remarkable feat for India’s

economy. With GDP growth consistently outpacing the world average, ranging between 7% to 7.5%, India has

etched its name as a stalwart of economic resilience and dynamism. This sustained growth trajectory has not

only bolstered India's domestic prospects but has also earned it accolades as a beacon of hope amidst global

economic uncertainties.

Robust Macro-economic Indicators: Key macro-economic indicators, such as GST collections, serve as

testament to the robustness of India's economy. Surpassing the Rs. 1.5 lakh crore mark consistently, these

indicators underscore India's inherent strength in demand and consumption patterns. Despite grappling with

global headwinds, India stands resilient, showcasing its ability to weather storms and emerge stronger.

Global Risks and Inflation Concerns: However, lurking amidst the glimmers of economic success are

persistent global risks, chief among them being inflation woes. The aftermath of the Covid-19 pandemic,

coupled with disruptions from events like the Russia-Ukraine war, has intensified inflationary pressures

worldwide. Such challenges threaten to impede crucial interest rate cuts necessary for fostering stable global

growth, casting shadows of uncertainty over the economic landscape.

Interest Rate Dynamics: Against the backdrop of surging interest rates in the US and UK, India stands at a

critical juncture. While the US and UK witness multi-decade highs in interest rates, India's Repo Rate hovers

close to its terminal level at 6.5%. This juxtaposition hints at the potential initiation of a downward cycle in

interest rates, laying the groundwork for sustained economic growth.

Investment Outlook: Amidst the flux of global uncertainties, India emerges as a beacon of opportunity for

investors worldwide. With major global investors eyeing India as a prime destination for investments,

overlooking its potential translates to missing out on one of the most significant economic opportunities of our

time. India's allure lies not just in its present economic prowess but also in its potential to shape the future

trajectory of global economic growth.

In conclusion, as India stands on the cusp of economic reform and growth, the world watches with bated

breath. The journey ahead may be fraught with challenges, yet it is also ripe with immense possibilities. For

India, the path forward beckons with promises of prosperity and the potential to leave an indelible mark on the

global economic landscape.

FORUM VIEWS, JUNE 2024 edition

From

to You...

BBF

FORUM VIEWS - JUNE 2024

nvestors across the world are moving towards putting their

money into passive funds for their simplicity, low fees, and

Igreater consistency in returns. In India too, large-cap fund

managers are finding it increasingly difficult to beat their

benchmark indices, and investors are getting drawn towards

index-style investing as the trends shift to Replicating market

returns rather than beating them.

There are several effective strategies to target certain risk and

return profiles, such as Smart Beta Funds, which have been

gaining a lot of popularity over the past few years. Smart Beta

Funds aim to bridge the gap between active and passive funds

by using a rule-based investing strategy that combines the

principles of both. In fact, recent trends suggest a growing

interest in Smart Beta.

Smart Beta Funds, also known as factor-based are a type of

investment fund that aims to outperform traditional index

funds by using a rules-based approach to construct a portfolio.

These funds are a hybrid between active and passive investing

strategies, as they rely on rules or algorithms to select and

weight securities, rather than simply tracking a market index.

Factor indexes are designed to help investors seeking to

capture the excess return of factors in a cost-effective and

transparent manner. A product giving exposure to only one of

these factors is called as single factor exposure whereas

product giving exposure to more than one factor is called

multi-factor exposure. Due to the historical cyclicality of

factors, investors may choose to diversify away from a single

factor and participate in multi-factor index.

Global ETF market is witnessing a remarkable growth. At the

end of February,2024 the global AUM reached a milestone of

1. What exactly are Smart Beta Funds, and how are they

different from traditional index funds or ETFs, how these

funds are structured?

2. How Smart beta fund are doing globally, what is the

trend among global investors towards these products?

12.3 trillion dollar with a diverse portfolio of 12,063 ETF

product. Conventinal ETFs constitute 79.57% and Factor

Based ETF are placed at 20.43%. Globally, there are more than

1,300+ smart-beta product with more than US $ 1.5 trillion.

So smart-beta products are widely used by the investor

across the globe.

Smart Beta Funds can be suitable for investors with some

expertise in capital markets, there are also simpler Smart

Beta strategies that may be more accessible to mas market

investors. These strategies may focus on well-known factors

such as low volatility or dividend yield and may be easier for

less experienced investors to understand and implement.

The suitability of Smart Beta Funds depends on an investor's

individual circumstances, risk tolerance, investment goals,

and level of understanding of the product. Investors should

carefully evaluate Smart Beta Funds in the context of their

overall investment strategy and seek advice from financial

professionals if needed.

Lack of differentiation within active funds, underperformance

of large cap funds and cost-effective alternatives have led to a

structural change for the smart beta investing landscape in

India. As on Feb 29, 2024, there are 27 smart beta ETFs

managing total assets worth 4,697 Cr and 30 index funds

managing total assets worth 12,097 Cr. In the last 2 years,

there have 37 new product launches within the passive smart

beta category. In the last one year itself, passive smart beta

funds have seen inflows worth 6,007 Cr across different

categories. Momentum/Alpha, Low Volatility and equal

weight are the three most popular categories within the

smart-beta space right now. Mostly this on back drop of

3. What kind of investors are they suited for - the mass

investor or those with some expertise in capital markets

who can understand the product well?

4. How are we seeing fund flows going up in this

category, what are the visible trends emerging?

Saket Kumar

Co-Founder

ETF Junction

EXPLORING SMART BETA INVESTING

FORUM VIEWS - JUNE 2024

strong performance among these factors. for instance,

almost 2,100 Cr has flown into momentum-based funds and

1100 Cr. in low volatility-based fund and almost 1,700 Cr in

Equal weight funds. The kind of trajectory that India is

witnessing is very similar to the developed markets like US

and experts believe that smart beta investing would become

central to India's asset management industry in the near

future.

Smart Beta strategies consider various factors when

constructing investment portfolios. These factors are specific

characteristics or attributes of stocks that have historically

been associated with excess returns or reduced risk.

Generally, 8 different type of factor’s are identified in terms of

explaining equity return and risk. These are namely, Value,

Size, Momentum, Quality, Dividend Yield, Volatility, Growth

and Liquidity. Most of the smart-beta products across the

globe are one or other variation of these 8 identified factors.

Regarding the structure of Smart Beta strategies, they can be

applied to various segments of the market, including large

caps, mid-caps, and small caps.

Investing in Smart Beta Funds can offer investors a

compelling combination of potential alpha generation, risk

management, transparency, and customization compared to

other options available in the market today. However, it's

essential for investors to conduct thorough due diligence and

consider their investment objectives and risk tolerance

before allocating capital to these funds.

5. What are some of the common factors that smart beta

strategies consider for investments? Are these strategies

around large caps, or can they be structured around mid-

and small caps too?

6. Can you enlist some of the benefits of investing in

Smart Beta Funds compared to other options that are

popular in the market today?

7. Smart Beta Funds work well in secular bull markets

where many and not just a few stocks are doing well. Do

you agree?

Not necessarily, yes something like Global Financial Crisis a

black swan event of 2008 is an outlier. But most smart-beta

even tends to do well in bear market as well specially to name

Low volatility and Quality. For instance, 2008, 2011 and 2015

was bad year for large-cap Nifty100 was -ve for these calendar

years by -56%, -26% and -0.8% respectively. However,

Nifty100 Low Vol 30 Index for calendar year 2008, 2011 and

2015 generated return of -42%, -12% and +9.8% respectively.

Clearly you can see that Low Vol 30 has done more than

reasonable job in protecting during bear market. Similarly,

Nifty Small cap 250 Index had fallen by 69% in 2008 and 26% in

2018. Nifty Small cap 250 Quality 50 Index from the same

universe had fallen only by 50% (2008) and ended up

generating +9.8% (2018). So, it’s important to understand

each factor and if it’s too confusing and then opt for multi-

factor like momentum-quality.

With over 25 years of exemplary experience in the Mutual Funds industry, Saket

is a seasoned professional with a proven track record of building successful

organizations from the ground up. As a visionary Co-Founder of ETF Junction

since January 2022, he has led the establishment of a thriving platform,

revolutionizing the investment landscape for ETFs.

His journey began in 1997 at Kothari AMC, India’s first private sector mutual

fund, where he played a pivotal role in establishing the Mutual Fund business in

the Eastern part of India. Subsequently, as Zonal Manager for Franklin Templeton

and Zonal Head for Bharati Axa Investment Managers, he showcased

exceptional leadership in driving growth and fostering client-centricity.

In 2013, he founded Rastey Commuting Services, transforming it into a

prominent player in transportation across India over nine successful years. The

company was awarded at the BID convention awards in Paris in 2019,

recognized as the best in quality service among car rental services in India.

Saket completed his management education at IIM Kolkata in 2000. His

extensive expertise lies in navigating the complexities of the Mutual Funds

domain and orchestrating organizational expansion. With an unwavering focus

on innovation and excellence, he is committed to making a significant impact on

the Mutual Funds industry.

Smart Beta Funds, also known as factor-based are a type of

investment fund that aims to outperform traditional index funds by

using a rules-based approach to construct a portfolio. These funds

are a hybrid between active and passive investing strategies, as they

rely on rules or algorithms to select and weight securities, rather

than simply tracking a market index.

FORUM VIEWS - JUNE 2024

t is a widely recognized fact that one of the key elements

of a robust corporate governance regime in any country

Iis the existence of an efficient and well-administered set

of regulations concerning the substantial acquisition of

Shares and Takeover of a company. The SEBI Act, 1992

expressly mandates SEBI to regulate substantial

acquisition of shares and takeovers by suitable measures.

Accordingly, SEBI provides a legal framework through the

SEBI (Substantial Acquisition of Shares and Takeover)

Regulations, 2011 (“Regulations/Takeover Code”), which

have been amended from time to time.

As the saying goes “Better the devil you know, than the

devil you don't”, the purpose of the Takeover Code is to

provide transparency arising out of substantial acquisition

of shares and takeovers and to bring fairness and

equitability in such transactions so as to protect the interest

of the investors in securities. At times, a substantial

acquisition of shares or takeover may result in the change of

management or promoters of a company. Thus, the

Takeover Code seeks to ensure that the public and minority

shareholders are provided with an exit opportunity in the

event of any substantial change in shareholding or change

in control of the company.

When there is an acquisition or an agreement to acquire

substantial shares, control or voting rights of a company in

excess of the prescribed threshold, the Regulations

mandate the acquirer to provide the shareholders an

opportunity to exit the company by making an open offer.

An open offer is an offer made by the acquirer to the

shareholders of the target company inviting them to tender

their shares in the target company at a fair valuation on

account of change in control or substantial acquisition of

shares.

1. What is 'Open Offer'? When is an 'open offer'

required to be made under SEBI SAST Regulations?

The Regulations provide for a threshold and acquisition of

shares beyond the threshold or change in control of the

target company triggers the requirement to make an open

offer. There are various circumstances in which the acquirer

is required to make an open offer thereby providing an exit

opportunity to the shareholders of the Target company. The

circumstances are- (a) when there is an acquisition of an

aggregate of 25 % or more voting rights in a target company

by the acquirer i.e. initial trigger, (b) if the acquirer already

holds 25 % or more voting rights, the open offer requirement

will be triggered if the acquirer acquires additional 5% or

more voting rights of the target company, within a financial

year i.e. creeping acquisition trigger, (c) Irrespective of the

acquisition or holding of shares or voting rights in the target

company, an open offer will have to be made by the acquirer

if there is an acquisition of control over the target company

AN OVERVEW OF SEBI’s TAKEOVER REGULATIONS

Zerick Dastur

Founder

ZERICK DASTUR,

ADVOCATES AND SOLICITORS

As the saying goes “Better the devil

you know, than the devil you don't”,

the purpose of the Takeover Code is to

provide transparency arising out of

substantial acquisition of shares and

takeovers and to bring fairness and

equitability in such transactions so as

to protect the interest of the

investors in securities.

FORUM VIEWS - JUNE 2024

i.e. Control Trigger (d) Acquisition of shares or voting rights

in, or control over any entity that would enable the acquirer

to exercise or direct the exercise of such percentage of

voting rights in, or control over the target company, would

attract the obligation to make an open offer requiring the

acquirer to make an open offer i.e. Indirect Acquisition (e) If

the indirectly acquired target company is a predominant

part of the business or entity being acquired, the

Regulations would treat such indirect acquisition as a direct

acquisition for all purposes and (f) Shareholders holding

shares entitling them to exercise 25 % or more of the voting

rights in the target company may, without breaching

minimum public shareholding requirements, shall be

entitled to voluntarily make an open offer to consolidate

their shareholding i.e. Voluntary open offer.

burden. The target company may wish to support, oppose

or remain neutral to, a transaction, often depending on who

the acquirer is. Therefore, it falls upon the regulator to

balance the interests of various stakeholders and to provide

for a fair, equitable and transparent regime that addresses

the concerns of all stakeholders.

The Hon’ble Securities Appellate Tribunal has also held that

the right to exit is an invaluable right and the shareholders

cannot be deprived of this right lightly. It is only when larger

interest of investor protection or that of the securities

market demands that this right could be taken away.

As discussed, the fundamental objective of the Regulations

is to provide each shareholder with an opportunity to exit

his investment in the target company when a substantial

acquisition of shares in, or takeover of a target company

takes place, on terms that are not inferior to the terms on

which substantial shareholders exit their investments. It

mandates the acquirer to make fair and accurate disclosure

of all material information to various stakeholders to enable

them to make informed decisions. Further, it ensures that

only those acquirers who are capable of actually fulfilling

their obligations under the Regulations make open offers.

As discussed above, the Regulations mandate an acquirer

to make an open offer on account of substantial acquisition

of shares or change in control in the Target Company. The

object behind this is to provide an exit opportunity to the

existing shareholders of the Target Company. However

there are certain situations and circumstances transactions

provided under the Regulations under which the obligation

to make an open offer is exempted which may lead to a

substantial acquisition of shares or change in control of a

company during the ordinary course of business. For

instance, a bank or financial institution may acquire

substantial shareholding of a company on account of

invoking a pledge against default of the loan. This may

otherwise trigger an open offer. However, the Regulations

provide for certain general exemptions to certain categories

of transactions from the requirements of making an open

offer subject to fulfilment of certain conditions.

The certain categories of transactions which are generally

exempted are as follows:

a. Acquisition pursuant to inter se transfer of shares

amongst immediate relatives, promoters, a company,

its subsidiaries, its holding company, other subsidiaries

of such holding company, persons holding not less than

50% of the equity shares of such company and also,

other companies in which these persons don’t hold 50%

3. What are the general exemptions for making an

open offer under the SEBI SAST Regulations? Does SEBI

have the power to grant exemptions from making an

Open Offer?

The fundamental objective of the

Regulations is to provide each

shareholder with an opportunity to

exit his investment in the target

company when a substantial

acquisition of shares in, or takeover of

a target company takes place, on terms

that are not inferior to the terms on

which substantial shareholders exit

their investments.

2. What is the objective of the SEBI (Substantial

Acquisition of Shares and Takeover) Regulations 2011?

The existence of an efficient and smooth-functioning

market for substantial acquisition of shares and takeovers

plays an important role in the economic development of a

country. Substantial acquisition of shares, or takeover of, a

listed company impacts a host of stakeholders, such as, the

acquirer, the target company, the management and the

public shareholders. It is critical that the legal framework

regulating such substantial acquisition of shares and

takeovers is precise, unambiguous and predictable, and

balances multiple, and at times, conflicting interests of

such stakeholders. For instance, the public shareholder of

the target company would be keen to get the highest

possible price for his shares, while the acquirer would want

to shoulder the least possible financial and regulatory

FORUM VIEWS - JUNE 2024

of shares and Persons or Shareholders acting in concert

for not less than three years.

b. Acquisition in the ordinary course of business by

Underwriter, Stockbroker, merchant banker, anyone

who acquires shares under regulation 44 of SEBI (ICDR)

Regulations, 2009 under the safety net scheme, a

registered market-maker of a stock exchange, a

scheduled commercial bank which acts as an escrow

agent for the parties and as discussed above, when

during an invocation of pledge by a scheduled

commercial bank or public financial institutions.

g. Increase in voting rights arising out of beyond the limit

pursuant to buy-back of shares provided such

shareholder reduces his shareholding such that his

voting rights fall to below the threshold referred to in

sub-regulation (1) of regulation 3 within ninety days

from the date.

h. Increase in the voting rights arising out of acquisition

pursuant to a rights issue, a buy back, a share swap

scheme and acquisition of shares in a target company

from a venture capital fund or a registered foreign

venture capital investor by promoters of the target

company pursuant to an agreement.

Apart from the general exemptions provided above, the

Regulations also empowers SEBI to grant exemption from

the requirements of making an open offer or grant a

relaxation from strict compliance with prescribed

provisions of the open offer process upon a specific

application made by the acquirer or the target company.

This exemption is granted by SEBI on a case to case basis.

For instance, in one case, SEBI granted an exemption from

the requirement of making an open-offer when the shares

were acquired by a family trust for streamlining family

succession. The exemption by SEBI was granted on the

grounds that that there would be no effective change in

exercise of voting power or in control/ management of the

target company since the said acquisition of shares was of

a private family trust and the beneficiaries of the acquisition

continued to be the family members.

Zerick Dastur is Proprietor of the Law Firm, practicing in the field of Court

litigation, Dispute Resolution, Arbitration, Securities law and Competition Law.

He is a triple Gold Medalist from Mumbai University having topped the Mumbai

University in Law. His practice covers diverse areas of Corporate, Commercial,

Securities law and Regulatory disputes. He is representing a number of clients in

the Port Sector, Infrastructure and Mining Sectors. He has represented clients in

domestic and international, commercial arbitration matters. He handles a

number of cases relating to securities law litigation and SEBI. He was a former

Partner at the Law Firm, J. Sagar Associates.

He has litigation experience before the Hon’ble Supreme Court, various State

High Courts Statutory Tribunals and Regulators. He has been involved in a

number of matters involving issues of Constitution Law. He has been involved in

landmark matters involving defence of Auditors and Corporate clients before

various Regulators/Civil/Criminal Courts and Tribunals in connection with

Corporate frauds. He has also advised various clients in matters involving

shareholder disputes and minority actions before the NCLT and CLB.

He also practices Securities Law and appears before the Securities Appellate

Tribunal and the SEBI. He has advised clients in connection with Competition

Law issues in everyday business operations including issues relating to anti-

competitive agreements and abuse of dominance by enterprises.

He writes for various newspapers and publications on issues relating to

Corporate law, Arbitration, Commercial and Competition Law. He regularly

writes on securities law for the publication run by the Bombay Stock Exchange

Brokers Forum. He is a regular speaker at events organised by Economic Times,

VC Circle, Indian Merchant Chambers, Consumer Resources, Corporate

Knowledge Foundation and the World Zoroastrian Chamber of Commerce.

He is a Member of the Law Committee of Indian Merchant Chambers and was

involved in the drafting of the Rules for the IMC International Arbitration Centre.

Views of the author are personal and do not constitute legal advice.

(Advocate Zerick Dastur and Advocate Khushil Shah)

The Regulations also empowers SEBI to

grant exemption from the

requirements of making an open offer

or grant a relaxation from strict

compliance with prescribed provisions

of the open offer process upon a

specific application made by the

acquirer or the target

company. This exemption is

granted by SEBI on a case to

case basis.

c. When the acquisition is made in various stages

pursuant to a disinvestment agreement where the

acquirer has made an open offer for acquiring shares at

earlier stages.

d. When the acquisition is made pursuant to a scheme

provided under Regulation 10(1)(d) of the Takeover

Code. For example, the scheme of revival under the Sick

Industrial Companies (Special Provisions) Act, 1985 or

the acquisition pursuant to the provisions of the

Securitisation and Reconstruction of Financial Assets

and Enforcement of Security Interest Act, 2002.

e. When there is an increase in shareholding beyond the

threshold limits without the acquisition of control

pursuant to pursuant to the conversion of equity shares

with superior voting rights into ordinary equity shares.

Any acquisition of shares or voting rights or control of

the target company pursuant to a preferential issue in

compliance with the SEBI (ICDR) Regulations, 2018.

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