What is BSE BOND Platform? – Operating guidelines (Detailed)
BSE BOND: is a separate platform facilitated by Bombay stock exchange for issuance of debt securities on private placement basis through an electronic book mechanism.
Private placement is a mechanism in which a company by way of issue of a private placement offer letter to a select group of persons to subscribe to the securities of that company.
BSE BOND Platform
- The issuer shall enter into an agreement with BSE to access the BOND platform. They can register with BSE using https://bond.bseindia.com/Issuer_Registration.aspx
- Merchant Bankers, Primary Dealers having registered with RBI or any other registered intermediaries as notified by SEBI from time to time, can act as the arranger. Arrangers are category-1 participants in the issue.
- An arranger can map sub-arrangers who should be registered with SEBI and BSE. Sub-arrangers can participate in the issue as category-2 participants.
- Registered Institutional Investors can participate in the bidding directly. Otherwise, they can even participate through an arranger/sub-arranger.
- All Qualified Institutional buyers (QIBs) are allowed to participate in all issues conducted on the EBP platform. If the issuer is a Non-Banking Financial Companies which are registered with Reserve Bank of India and Housing Finance Companies registered with National Housing Bank then the Qualified Institutional Buyer, eligible bidders and other participants enrolled with BSE should comply with the RBI requirements if any prescribed in this regard.
- However, Non- QIB investors can not bid directly on BSE BOND platform. They can participate in the bidding process through category -1 participants.
- Except on the bank holidays, bidding will take place during normal business hours of the exchange’s secondary market i.e. 9AM to 5PM from Monday to Friday.
- Issuer will have to provide the following details in invitation of issue. These will be made visible to the participants:
|Name of the issue||Issue Rating if any||Guarantee Type|
|Face Value of security||Coupon/Interest frequency||Put option|
|Size of the issue||Interest payment type||Call option|
|Description of security||Green Shoe Option||Tenure of the instrument|
|Notification Timing||Secured Type||Any other info as necessary|
Issuer is required to upload Private Placement Memorandum (PPM) which acts as an information memorandum pertaining to the issue.
- Bidding should be for a minimum of 15 minutes and can be extended for more than 15 minutes as per the issuer discretion. This can be extended as long as such extension is within the business hours.
- The Issuer on the electronic platform should activate the issue at least 1 hour and 15 minutes prior to the desired Bid Start Time.
A participant can be able to enter the in the Amount if it’s a Fixed Rate Issue and will be able to enter in Coupon and Amount in a Yield Based issue. One can enter multiple bids. These bids can only be entered by Arrangers/Sub-Arrangers that are mapped to the Issue. Modification and cancellation of the already placed bids are allowed only during the Bidding Period. Once a bid is placed successfully, an acknowledgement number will be generated.
- Once the bidding process is closed the issuer may Withdraw the issue or Initiate a Negotiation or Proceed with Allocation.
- Once the allocation is done, the same will be visible to the arrangers/sub-arrangers and the investors. On successful completion of the Final Allocation and Issuer should then proceed with Issue Closure.
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