An outline-Core Investment Company
A Core Investment Company (CIC) is classified as a Non-Banking Financial Company (NBFC) by the Reserve Bank of India (RBI). These companies predominantly put investments into shares of its own gathered companies for stake holding purposes, yet can’t take part in trading of these instruments or complete some other sort of financial activitie
Such companies have their interest in shares for the reasons for not doing any type of exercises connected with trading. Such interest in shares is basically completed to hold stake in the group companies.
So, these companies have larger part of their investment in group companies. As a rule, around 90% of the equity is available in the gathered companies. Such stake holding is as equity shares, preference shares and other type of shares. Such holding or part connected with holding should not be under 60% of their assets.
However, these companies are controlled by RBI, they don’t participate in any type of exercises connecting with lending and borrowing. Until the year 2010 these companies were going under a similar guideline connected with NBFC. Notwithstanding, in 2010 the RBI drew out a different system for administering the working of Core Investment Companies.
Meaning of Core Investment Company
Coming up next are the meanings of a core investment company:
RBI has grouped this type of company as a NBFC which carries on exercises connecting with putting investments into shares and securities.
Such companies hold the investments as equity, preference shares, debts and credits. Such investment adds up to 90%.
Such investment as equity in group of companies should come to or involve over 60% of its total asset size.
Such exercises connected with investment trading are not permitted to be done for Core Investment Companies. Any way these companies can complete transactions like divestment or weakening.
Generally, these companies just do investment exercises such investment can be made in other monetary foundations, government securities, money market securities and different types of instruments.
Process of Registration of Core Investment Company
The candidate needs to download the application structure for registerment from the site of RBI. The application structure connection can be tracked down https://rbidocs.rbi.org.in/rdocs/Forms/PDFs/CIC260411F.pdf
It should be filled in and submitted to the Regional Office of DNBS (Department of Non-Banking Supervision) alongside the supporting documents as referenced in the form. The DNBS must be the one under which the company has to get registered.
Such application should be accompanied with the agendas relating to the documentation needed for the registration of core investment company.
In the event that the RBI requires more archives to be presented, the equivalent can be called by RBI. In the event that the necessity of archives, the candidate needs to present the reports inside 30 days of the notice.
There are companies that are absolved from registration, but these companies need to pass a Board Resolution that they will not in the future get involved in getting public funds.
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