Financial Information (Restated and Audited Statements)
The Financial Information (Restated and Audited Statements) section presents the issuer company's historical financial performance and financial position through audited and restated financial statements. It provides a comprehensive view of the company's revenues, expenses, profitability, assets, liabilities, cash flows and shareholders' equity, enabling stakeholders to evaluate its financial health before the public issue.
This section is included in the DRHP to ensure transparency and present financial information in a consistent and comparable format. Since investors rely heavily on financial performance to assess a company's stability, growth prospects and valuation, the issuer company is required to disclose accurate and complete financial information that fairly reflects its business operations and complies with applicable accounting standards.
It is prepared by the issuer company in consultation with its statutory auditors, independent chartered accountants, Book Running Lead Manager (BRLM) and legal advisors and is disclosed in accordance with the Companies Act, 2013, the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 and the applicable Indian Accounting Standards (Ind AS). It generally appears under the "Financial Information" section of the DRHP.
In this section, the issuer company is required to disclose its restated audited financial statements, including the Balance Sheet, Statement of Profit and Loss, Cash Flow Statement, Statement of Changes in Equity, key accounting policies, financial ratios, notes to accounts, auditor's reports and other material financial disclosures prescribed under the applicable regulations.
These disclosures enable investors to analyse the company's historical financial performance, profitability, liquidity, solvency, cash flow position and overall financial strength, helping them make well-informed investment decisions based on reliable and comparable financial information.
Related Party Transactions
The Related Party Transactions (RPTs) section provides details of transactions entered into by the issuer company with its promoters, promoter group, directors, key managerial personnel, subsidiaries, associate companies, or other related parties. These transactions may include the purchase or sale of goods and services, loans, guarantees, leases, investments, or any other financial or commercial arrangements that could influence the company's operations or financial position.
This section is included in the DRHP to ensure transparency regarding transactions that may involve potential conflicts of interest. Since dealings with related parties may not always occur on an arm's length basis, the issuer company is required to disclose such transactions so that stakeholders can evaluate whether they are fair, reasonable and conducted in the ordinary course of business.
It is prepared by the issuer company in consultation with the Book Running Lead Manager (BRLM), statutory auditors, Company Secretary and legal advisors and is disclosed in accordance with the Companies Act, 2013, the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 and the applicable Indian Accounting Standards (Ind AS 24 – Related Party Disclosures). It generally forms part of the "Financial Information" or "Related Party Transactions" section of the DRHP.
In this section, the issuer company is required to disclose complete details of material related party transactions, including the nature of the relationship, transaction values, outstanding balances, approval mechanisms, pricing basis and any other material terms that could impact the company's financial position or governance.
These disclosures enable investors to assess the fairness of the company's dealings with related parties, identify potential conflicts of interest and understand how such transactions may influence the issuer's financial performance and corporate governance standards.
RPT Norms Aligned with Main Board: The March 2025 amendments to the SEBI (LODR) Regulations, 2015 align the related party transaction norms applicable to SME-listed companies with those applicable to companies listed on the main board. SME issuers should factor this post-listing compliance obligation into their governance frameworks at the DRHP stage.
Management Discussion and Financial Condition Discussion (MD&A)
The Management Discussion and Analysis of Financial Condition and Results of Operations (MD&A) section provides management's perspective on the issuer company's financial performance, operating results, liquidity, capital resources and the key factors that have influenced its business over the reporting period. Unlike the financial statements, which present historical figures, this section explains the reasons behind those figures and the business circumstances affecting the company's performance.
This section is included in the DRHP to help the issuer company provide a meaningful analysis of its financial condition, operational performance, business trends, risks and future growth drivers. It enables the management to explain significant changes in revenue, expenses, profitability, working capital, cash flows, capital expenditure, indebtedness and other material developments that may not be evident from the financial statements alone.
It is prepared by the issuer company in consultation with the Book Running Lead Manager (BRLM), Chief Financial Officer (CFO), statutory auditors, Company Secretary, legal advisors and senior management and is disclosed in accordance with the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, the Companies Act, 2013 and other applicable disclosure requirements. It generally forms part of the "Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) " section of the DRHP.
In this section, the issuer company is required to provide a balanced discussion of its financial performance, operational results, liquidity position, capital resources, significant accounting estimates, known trends, business uncertainties, industry developments and material events that have impacted or are expected to impact its operations, while ensuring that the disclosures are factual, consistent and supported by the audited financial information.
These disclosures enable investors to understand not only what the company's financial performance has been, but also why it has changed over time, allowing them to make a more informed assessment of the issuer's financial health, operational efficiency and future business prospects.
Legal and Other Information
The Legal and Other Information section provides comprehensive details about the issuer company's legal status, regulatory compliance, statutory approvals, material litigations, intellectual property, material contracts and other legal matters that may have a significant impact on its business or the proposed public issue. This section presents the legal and regulatory framework within which the company operates and highlights any legal risks that prospective investors should consider before investing.
This section is included in the DRHP to ensure that the issuer company makes complete, accurate and transparent disclosures of all material legal and regulatory matters that could affect its operations, financial position, or reputation. It also demonstrates the company's compliance with applicable laws and enables stakeholders to assess any legal or regulatory challenges associated with the business.
It is prepared by the issuer company in consultation with the Book Running Lead Manager (BRLM), legal advisors, Company Secretary, statutory auditors and other professional advisors and is disclosed in accordance with the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, the Companies Act, 2013 and other applicable laws. It generally forms part of the "Legal and Other Information" section of the DRHP.
In this section, the issuer company is required to disclose complete and accurate information under the following key disclosures:
1. Other Litigations and Material Developments
The issuer company must disclose all material legal proceedings, investigations, disputes and significant developments involving the company, its promoters, directors, subsidiaries, or Key Managerial Personnel (KMPs). This includes civil, criminal, tax, regulatory, labour, environmental and commercial litigations that could materially affect the company's business, operations, financial position, or reputation.
2. Government and Other Approvals
The issuer company is required to disclose all material licenses, registrations, permits, consents and approvals obtained from government authorities and regulatory bodies that are necessary for carrying on its business and completing the IPO. Any pending approvals or material conditions attached to such approvals must also be disclosed.
3. Regulatory and Statutory Disclosures
The issuer company must disclose its compliance with applicable laws, statutory requirements and regulatory obligations, including declarations, approvals, penalties (if any) and other disclosures mandated under the SEBI (ICDR) Regulations, 2018, the Companies Act, 2013 and other applicable legislation.
These disclosures enable investors to evaluate the issuer company's legal standing, regulatory compliance, potential liabilities and operational risks, providing a clearer understanding of the legal environment in which the company operates before making an investment decision.
Government and Other Regulatory Approvals
The Government and Other Regulatory Approvals section provides details of the material approvals, licences, registrations, permits, consents and certifications that the issuer company has obtained or is required to obtain from various government authorities and regulatory bodies to lawfully conduct its business and undertake the proposed public issue. These approvals demonstrate that the company's operations comply with the applicable legal and industry-specific requirements.
This section is included in the DRHP to ensure that the issuer company transparently discloses the regulatory permissions essential for its business continuity and IPO process. It also highlights whether any critical approvals are pending, suspended, or subject to specific conditions that could materially affect the company's operations or the successful completion of the public issue.
It is prepared by the issuer company in consultation with the Book Running Lead Manager (BRLM), legal advisors, Company Secretary, statutory auditors and other professional advisors and is disclosed in accordance with the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, the Companies Act, 2013 and other applicable central, state and sector-specific laws. It generally forms part of the "Legal and Other Information" section of the DRHP.
In this section, the issuer company is required to disclose complete and accurate details of all material government and regulatory approvals, licences, registrations, permits, environmental clearances, industry-specific authorisations and statutory consents required for its business operations and the IPO. The company must also disclose the status of pending approvals, renewal requirements, material conditions attached to such approvals and any regulatory restrictions that could have a material impact on its business.
These disclosures enable investors to evaluate whether the issuer company possesses the necessary legal authorisations to operate its business, assess potential regulatory risks and understand the extent to which its operations and proposed IPO depend on obtaining or maintaining such approvals.