Frequent change of names by listed companies

SEBI had vide its circular No. SMDRP/POLICY/CIR- 8/99 dated April 26, 1999 directed that companies who change their name suggesting any new line of business (including software business), should disclose the turnover and income, etc., from such new activities separately in the quarterly/annual results required to be submitted/published in compliance with these clauses.

In addition to the above provisions, SEBI has now directed vide its circular No. SEBI/MRD/Policy/AT/Cir-20/2004 dated April 30, 2004, that all listed companies, which decide to change their names, shall be required to comply with the following conditions:

• A time period of at least 1 year should have elapsed from the last name change.
• At least 50% of its total revenue in the preceding 1-year period should have been accounted for by the new activity suggested by the new name.
• The new name along with the old name shall be disclosed through the web sites of the respective stock exchange/s where the company is listed and also through the EDIFAR web site for a continuous period of one year, from the date of the last name change.