Listing of Securities

Listing refers to the formal admission of a company's securities to trading on a recognised stock exchange, after the company satisfies that exchange's prescribed eligibility criteria and enters into a listing agreement with it.

A company seeks listing for several practical reasons:

• It gives the company's shareholders a ready, continuous market in which to buy or sell their holding, which in turn makes the shares more attractive to prospective investors when the company next wants to raise capital.
• It improves the company's visibility, public reputation and credibility, since a listed company is subject to continuing public disclosure and scrutiny.
• It typically improves the marketability and hence the value of the company's securities, since investors generally place a higher value on shares they know they can sell easily if needed. …