When a New ISIN Is Required
If the transferee already has listed equity shares with an existing ISIN, the scheme shares are typically issued under the same ISIN, because they rank pari passu with the existing shares. A new ISIN is required where the transferee is a newly incorporated company, where the scheme creates a new class of shares, or where the existing ISIN has been frozen or suspended.
The scheme documents usually provide that the new equity shares shall rank pari passu in all respects with the transferee’s existing equity shares, including dividend and bonus entitlement. That pari passu character is the basis for using the existing ISIN.
The Depository Application
Where a new ISIN is required, the transferee must apply to NSDL or CDSL with the prescribed documents: the board resolution, the scheme, the NCLT order, the shareholding pattern, and the corporate action form. The depository processes the application and activates the ISIN. The transferee should apply well before the record date to avoid a gap between the allotment and the demat credit.
The Listing Condition
For a listed transferee, the shares issued under the scheme must be listed on the stock exchange before they can be credited and traded. The transferee must obtain the listing permission and the trading approval. Until then, the shares may remain frozen in the depository system, as several scheme documents expressly provide. The ISIN activation and the listing permission are sequential, not simultaneous.
The Documentation
The file should contain: the ISIN application; the depository acknowledgement; the ISIN activation letter; the listing application; the trading approval; and the demat credit confirmation. A scheme that credits shares before the listing permission is exposed to a regulatory objection.
Call to Action: For ISIN application, depository coordination, or listing-permission sequencing, contact office@anujdesaiassociates.com or 9619456656. Website: https://anujdesaiassociates.com. LinkedIn: linkedin.com/in/ca-anuj-desai-122547230.