The following are the qualifying requirements that an unlisted company must meet in order to make a public offering:
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The company’s pre-issue net worth should not be less than Rs. 1 crore, and it should have been maintained for the previous three out of five years.
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The net worth should be sufficient for the next two years.
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Profit records must be kept for at least three years out of the next five years.
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The issue size should not exceed 5 times the issue’s pre-issue net worth.
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If these conditions are not met, the firm can issue through the book-building process, but it must allocate at least 60% of the issue size to Qualified Institutional Buyers.