One more benefit of investing in unlisted shares

Buy Sell Unlisted sharesThe income-tax (IT) department said that income from transfer of unlisted shares will be categorized as capital gains, irrespective of the holding period. The clarification is a continuation of the tax department’s efforts to reduce litigation and other disputes and bring in a uniform approach to classification of income.

The current announcement is positive for investors investing in unlisted shares as assesses can claim the income as capital gain instead of business income. Capital Gain on sale of unlisted securities which qualify as short term is taxable at 15%. Capital gain on sale of unlisted securities attract a long term capital gain tax at the rate of 20% with indexation benefit. Business income, on the other hand, is taxable on slab rate which can be as high as 30%, that too without indexation.

In February this year, the tax department had issued a similar clarification regarding classification of income arising from transfer of listed shares wherein it had said that an assessee could classify income from a transaction as capital gains after 12 months.

However, the tax department has listed three exceptions wherein this clarification will not be applicable. It will not apply in cases where the genuineness of transactions in unlisted shares is questionable, where a question of lifting the corporate veil arises and where there is transfer of control and management, the CBDT said in a notification.


RBL Bank may launch IPO soon

RBL Bank IPOThe capital markets regulator has given the conditional approval for the initial public offer of RBL Bank (formerly Ratnakar Bank), and a final go-ahead is expected soon. RBL Bank is planning to raise Rs.1,100 crore through its IPO.

RBL, which had filed its draft prospectus with the regulator Securities and Exchange Board of India (Sebi) on 23 June 2015, has been waiting for the Sebi’s approval for almost 10 months now. The regulator had withheld approval as RBL had in the past issued securities to more subscribers than stipulated under The Companies Act, 2013.

For buying and selling physical/demat unlisted/delisted shares of RBL Bank and all companies, please contact call on 08108234400 or email on

In December, Sebi announced that any offer or allotment of securities shall be considered as public issue if the number of allottees exceeds 200 persons in a fiscal year under the Companies Act, 2013, as against the cap of 49 persons provided in The Companies Act, 1956.

Sebi’s conditional approval requires RBL to take a corrective action to resolve the past violation. The company has already send letters to provide an exit opportunity to investors who had subscribed to shares in these past rounds.

On 21 December 2015, RBL Bank raised Rs 488 crore through a pre-IPO round of fundraising. The private lender raised the funds from international investors, including the Asian Development Bank (ADB) and the UK government’s development finance arm CDC Group Plc, among others. Over the last three years, global and local private equity and development funds have invested more than Rs 1400 crore in the bank in three tranches. Housing Development Finance Corp. Ltd (HDFC), Norwest Venture Partners, Samara Capital, Beacon Capital, Faering Capital, TVS Shriram, Cartica Capital, Ascent Capital, Aditya Birla Private Equity, IDFC’s Spice Fund and ICICI’s Emerging India Fund are among its shareholders.

In 2014-15, the bank reported revenue of Rs 2,356.4 crore, compared with Rs 1,612.5 crore in the previous year. It reported a profit of Rs 208.4 crore as against a profit of Rs 92.8 crore a year ago.

Though RBL Bank is an old private sector bank established in 1943, it has accelerated its growth under a new management, led by managing director and chief executive officer Vishwavir Ahuja since 2010. In the last three years, the bank has shed its regional image, opened branches and attracted new investors.

Shopping list of niche unlisted companies ahead of IPO

 As secondary markets gain momentum, many companies operating in niche business are looking to tap primary market for raising funds through initial public issue (IPOs). Unlisted shares of e-commerce, payments banks and general insurance companies are in fancy.

Insurance is an age-old and proven business and with rising per capital incomes, there will be more need for insurance cover. Shares of life insurance companies ICICI Prudential Life Insurance and HDFC Standard Life Insurance are seeing high demand from investors. Shares of general insurance firm ICICI Lombard are also being highly traded.

It is not only insurance companies but a whole host of new segments will be entering the market soon. These include leading stock exchange Bombay Stock Exchange, a mutual fund UTI Asset Management Company, an e-commerce company MSTC and payments bank FINO Paytech

Investors can also draw comfort, especially in the case of new-age businesses, from the presence of private equity (PE) and venture capitalist (VC) investors. Their presence usually indicates a lot of due-diligence has already been done on the company, it is being mentored, and is likely to have a high quality of corporate governance.

I am market making in unlisted/ delisted shares. Please contact me for more details and updates on 08108234400 or email on

Sun Pharma’s journey to the top

This chart shows the journey of Sun Pharma which went on to be India’s largest pharma company, its shares seeing astronomical surge, long term investors getting rewarded handsomely, and Dilip Sanghvi hitting a jackpot to become India’s richest person !!!

Investing in companies at a very early stage, whether listed or unlisted can provide such king of multibagger returns. I am market making in unlisted/ delisted shares. Please contact me for more details and updates on 08108234400 or email on

Pharma giant Sun Pharma's Dilip Sanghvi

Rising fortunes of Sun Pharma and Dilip Sanghvi

How to maximise profits in stock investments

Profit maximisation is prime objective of investors. But rarely a few achieve it. For earning huge profits as shown in chart, which only institutional investors are currently earning, and to maximise returns from stocks investment, investors should consider diversifying their portfolio into unlisted/ delisted stocks.

I am market making in unlisted/ delisted shares. Please contact me for more details and updates on 08108234400 or email on

Emotional swings

Chart showing various emotions and valuations

Various phases of stocks price movement