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Definition :

Prospectus means any document described and issued as a prospectus and includes a red herring prospectus or shelf prospectus or any notice, circular, advertisement or other document inviting offer from the public for subscription or purchase of any securities of a body corporate.

 Role of prospectus :

Prospectus is an invitation to offer. Persons responding to such invitation make an offer to purchase securities of the company.

Contents of prospectus :

A. General Information                             B. Financial information

C. Declaration                                              D. Other matters

AGeneral Information :   

  • Name & address of company.
  • Date of opening and closing of issue.
  • Issue of allotment letter and refund.
  • Details of opening share application money account and where all the money received are to be deposited.
  • Details of underwriters.
  • Consent of directors, auditors and expert’s opinion.
  • Authority for the issue with details of resolution.
  • Procedure for schedule and allotment of securities.
  • Capital structure of the company.
  • Objects of the issue.
  • Management perception of risk.
  • Gestation period of project.
  • Minimum subscription.
  • Details of directors and their remuneration.
  • Sources of promoters contribution
  • Other related disclosures.

B.  Financial Information :

  • Reports of audited “Profits and Loss account”
  • Reports relating to “Profits and Loss account” for each of the 5 financial years preceding the issue.
  • Reports relating to which the proceeds of the issue are to be applied.

C. Declaration :

A declaration shall be given about the compliance of the requirements of the Act and stating that the prospectus is not in contravention of The Companies Act 2013, Securities Contract Regulation Act 1956 and SEBI Act 1992 and the regulations framed thereof.

D. Other Matters :

Reports relating to utilization of the proceeds of the previous issue of securities towards purchase of  :

  • Any business.
  • Any interest in business.
  • Any immovable properties.
  • Any shares or debentures of other body corporate.


Any other matters relating to material contracts, related party transactions, terms and conditions of term loans including rescheduling, default, etc..




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