{"id":8688,"date":"2022-07-28T16:46:31","date_gmt":"2022-07-28T11:16:31","guid":{"rendered":"https:\/\/aayushbhaskar.com\/?p=8688"},"modified":"2022-08-04T15:11:14","modified_gmt":"2022-08-04T09:41:14","slug":"how-to-buy-shares-of-unlisted-companies-in-india","status":"publish","type":"post","link":"https:\/\/aayushbhaskar.com\/how-to-buy-shares-of-unlisted-companies-in-india\/","title":{"rendered":"How To Buy Shares Of Unlisted Companies\u00a0In India","gt_translate_keys":[{"key":"rendered","format":"text"}]},"content":{"rendered":"

Unlisted shares are simply those shares that are not listed on any of the capital markets.<\/p>\n

These assets are, however, available on alternate platforms.<\/p>\n

This article will tell you everything about these unlisted companies and how you can easily invest in them.<\/p>\n

So, without delaying anymore, let’s get straight to it.<\/p>\n

What Are Unlisted Shares?<\/span><\/h2>\n
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UnlistedKart – Private Equity Investment Focused Fintech<\/figcaption><\/figure>\n

Unlisted shares are Securities or financial products that are not listed on the stock exchange. They are traded in the over-the-counter(OTC) market and are called OTC securities.<\/span><\/p>\n

The risk associated with investing in the stock market is comparatively lower than in the OTC markets because of the SEBI’s effective regulation, market pricing, and disclosure transparency.\u00a0<\/span><\/p>\n

However, there is no such openness or control in the unlisted space. Thus, investors must exercise thorough scrutiny before investing in this sector.<\/span><\/p>\n

Types Of Unlisted Financial Securities<\/span><\/h2>\n

Financial instruments that do not meet listing standards are not traded on a formal exchange.\u00a0<\/span><\/p>\n

Unlisted securities are typically issued by smaller or newer companies that cannot or do not want to adhere to official exchange rules, such as market capitalization limitations or listing costs.\u00a0<\/span><\/p>\n

Additionally, the business must have issued a certain number of shares and should be able to pay for its listing on the exchange while it becomes public.\u00a0<\/span><\/p>\n

Sometimes, even the legitimate foreign corporations that don’t want to submit the SEC reports, don\u2019t list themselves on the stock markets<\/a>.<\/span><\/p>\n

On the other hand, a nominal stock is frequently traded on the OTCBB or the pink sheets and is one of the most popular unlisted security. This includes penny stocks which can trade for meager prices.<\/span><\/p>\n

Many non-stock, unlisted instruments, such as swaps, government securities, and corporate bonds, are also traded on the OTC market.\u00a0<\/span><\/p>\n

A Step-by-Step Guide To Investing In Unlisted Shares<\/span><\/h2>\n

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The following seven steps can be used to breakdown the investment process for unlisted shares:<\/span><\/p>\n

1. Demat and Trading Account Requirements\u00a0<\/span><\/h3>\n

A Demat account and a trading account are required if it is your first time investing in unlisted shares.<\/span><\/p>\n

You can use any CDSL or NSDL-registered trading and Demat account. However, you may not be able to purchase or sell unlisted stocks through the brokerage firm giving you the Demat account since they don’t deal in such stocks.\u00a0<\/span><\/p>\n

The nation’s two depositories, CDSL and NSDL, play a vital role in this situation. The equities are sent to your Demat account when you purchase unlisted securities.\u00a0<\/span><\/p>\n

You can even use MyEasi App from CDSL or the NSDL application to check the same.<\/span><\/p>\n

2. Select the Best Intermediary<\/span><\/h3>\n

The next stage is selecting the ideal intermediary, which is one of the most vital steps throughout the entire process. You can buy unlisted stocks from a variety of intermediaries. These are:<\/span><\/p>\n