Clause 49 of the Listing Agreement

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udit sharma (Querist)

24 December 2010 Hi...

Please someone explain me the meaning of term'Material non listed Indian Subsidiary' as per Listing Agreement in simple words. If possible, please explain it with the help of an example.

God Bless

Udit Sharma

Ajay Mishra

Ajay Mishra (Expert)

24 December 2010 Hi

The term material non-listed Indian subsidiary is defined under Explanation I of Clause 49 III of Listing Agreement:

The term “material non-listed Indian subsidiary” shall mean an unlisted subsidiary, incorporated in India, whose turnover or net worth (i.e. paid up capital and free reserves) exceeds 20% of the consolidated turnover or net worth respectively, of the listed holding company and its subsidiaries in the immediately preceding accounting year.

For Example:

A Limited (Listed Company) and B Limited (Subsidiary Company ) consolidated turnover/networth is 150 Crores on March 31, 2010.

If B Limited turnover/net worth is 25 crores as on March 2010, in that case it will not be considered as material non-listed Indian subsidiary.

If B Limited turnover/net worth is 40 crores as on March 2010, in that case it will be considered as material non-listed Indian subsidiary.

Regards
CS Ajay Mishra

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udit sharma

udit sharma (Querist)

24 December 2010 Thanks for ur reply Ajay Sir....

In case B Ltd. is a Material Non Listed Indian Subsidiary of A Ltd. then 1 Independent Director from the Board of A Ltd. will have to be appointed on the Board of B Ltd.

This will be mentioned in the Annual Report of 2009-10 or 2010-2011??????

Please reply sir.....

Ajay Mishra

Ajay Mishra (Expert)

24 December 2010 Yes, You are right at least one Independent Director of Holding company should be director in subsidiary director.

The detials will be mentioned in Annual Report 2010-2011, because turnover/net worth will be count of the preceeding year, i.e. 2009-10.

Please suggest, if i am wrong.

Regards
CS Ajay Mishra

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