The investments in the companies that are not listed in the open market are unlisted shares trading. Unlisted or unquoted investments are generally issued at favorable prices by the investors. Unlisted companies being smaller in size have the most ambitious plans to soar with maximum profits in the trading market. To nurture and grow the potential of small-scale businesses, they need high investments to meet their capital needs. 

Unlisted companies are considered to be high-risk by angel investors, financial institutions, and individual investors. Despite knowing the risks involved, a large pool of investors jumps into the unlisted securities market. 

Here are the reasons for investors to be more inclined towards unlisted shares investment:

1. Capital contraction

While investing, capital contraction is the most important concern of the investors. The amount of capital to invest in unlisted equities is accountable for the loss or profit of the investors. This drags them down and refrains them from investing even in potential shares. 

2. Lack of liquidity 

The investment made through online platforms is highly illiquid. It implies that the investors can’t sell their shares until the respective business is not driven towards a successful exit and sustain the financial regularities with the existing funds. 

For small-scale businesses, it is difficult to retain customers for a long time with dreary financial status. While, even for successful businesses, a flotation or purchase is unlikely to happen for several years. Investors should stay for a long-term in the businesses to avail significant returns. 

3. Dividends

The new-age businesses lack enough funds to pay dividends at the early stages. Instead, they re-invest the funds into the businesses and increase the overall shareholder value. Most successful businesses don’t pay dividends to the stakeholders and continue to invest again for more profitable returns. 

4. Dilution

If you invest your funds through any platform, it could probably be diluted. Simply put, if businesses require funds at the later stages, the number of shareholders will increase and you are likely to get reduced profits as the investor in the respective company. 

The liberty provided to different investors in a company might be another reason for the investors for dilution of the stakes. Continuous reinvestment in the businesses is a safe option to increase the shareholder percentage. 

5. Segmenting the investments

The start-ups and new-age businesses are at the ‘yet to execute their potential’ stage before the investors show interest in investing their funds. It might put the investors in the dilemma of whether to invest or not. Diversifying the investment portfolio is in the best interest of the investors. Equalizing large bricks of investments into multiple unlisted companies from various sectors over investing large chunks in one small company is not a wise perspective. The online platforms dilute a large portion of the investments of the stakeholders in the stage of raising funds.

Buying unlisted shares is a highly speculative investment. For investors who wish to speculate on the stock of a small or smaller company, it is the best bet. Buying or trading unlisted shares, however, is not without risk, as there’s a chance you will lose your money. However, for the risk-tolerant investor, unlisted shares can be a highly profitable investment. While there are no guaranteed profits, there are several things you can do to increase your chances of profiting from this high-risk investment. The most popular means of profiting from unlisted shares is to find a company that has a good market cap. Thus, below are some of the things you should consider before investing in unlisted shares.

·         Your Time Horizon– If you’re willing to accept the risks of investing in unlisted shares, you might consider an OTC investment. If the security’s trading volume is low and it hasn’t been a while since it was first listed on the OTC market, you may have an advantage as it will be cheaper. Depending on the product, there are several advantages and disadvantages of investing in OTC securities. Moreover, consider if you want to have your investment as long-term or short-term.

·         Diversification-There is no doubt that diversification in your investment portfolio is a crucial component to success. As an example, if you’re heavily invested in one stock, your risk exposure may be considerably greater than the overall market. This is especially true if your portfolio’s overall size is relatively small, so the risk of losing your entire investment is even greater. By choosing to purchase unlisted shares, your portfolio grows by the number of shares you own.

·         The Size of the Company– Usually, unlisted companies are smaller companies or start-ups, which tend to be less stable than bigger, more established firms, and therefore require less investment. Buying an unlisted share is a means of investing in a company that can’t necessarily afford to advertise itself, or in an unlisted business that doesn’t want to list publicly. It depends on the nature of the business, the size, and the economic moat. A company’s scale and moat are widely regarded as the main criteria of a successful investment.

·         Volatility-Volatility is a financial term that refers to a fluctuating price over a short period. Volatility in prices is generally considered good news because it means that there is high demand for the securities which in turn means the price will rise. But volatility in the price of a stock can also be bad news. A large rise in the price over a short period can be a bad sign because it means that an investor is overpaying for the stock.If your long-term time horizon exceeds 10 years or perhaps even 20 years, an investment in best-unlisted shares to buy can be very valuable. You could realize tremendous upside in your investments, potentially having a higher rate of return than you could realize in a company that is already trading on a stock exchange. In addition, there is no insider and market-moving information that could negatively impact the value of your shares in the long term.

With many benefits around investing in unlisted stocks, it is no wonder that they are becoming more and more popular.

Suppose you have ever thought about getting started with investing but hesitated because of the perceived complexities and risks involved (and not to mention the heavy fees and commissions) with listed stocks. In that case, unlisted stocks might be an option worth considering. Here are some of the benefits for one as an investor.

1. Risk: One can rest easy knowing that whatever happens, their investment is safe from the risk of manipulation or devaluation due to market forces or financial irregularities – so long as they invest in a reputable company. Investing in an unlisted stock means there is less public information on which to base their investment decisions. The unlisted stock prices are also low compared to listed, so one can invest more and gain more profit.

2. Liquidity: One of the most incredible benefits one get from investing in unlisted stocks is liquidity – the ability to quickly cash out of an investment and get back their original capital (or at least a large portion of it). With listed stocks, there are numerous restrictions on when and how one can cash out. For example, if thy want to sell some shares, even if offered below market rate, there may be a settlement period of up to 3 business days. But with unlisted stocks, cashing out is as simple as giving their broker a call or sending them an email requesting that they sell their shares for them! One can then receive funds into their bank account within 24 hours.

3. No Brokerage Fee: Since there are no listing fees to be paid, no brokerage fee is charged. One can save a lot of money by not paying a broker’s commission and other costs associated with trading listed stocks.

4. No Minimum Investment: With listed stocks, there could be a minimum amount they need to invest before trading on the stock exchange. Some exchanges may require a deposit of thousands or tens of thousands of dollars before they can begin trading listed stocks – but not unlisted stocks! This allows more people starting out with small investments to get into the game at minimal cost.

5. Less Paperwork Involved: Compared to listed, the paperwork involved in investing in unlisted stocks is less. The requirements tend to be much easier, and oftentimes there are no requirements at all.

6. Less Public Information: Since listed stocks are traded on an open exchange where almost anyone can access information about the stock, there is more public information available than with unlisted stocks where only certain investors or organizations have access to that type of information – which in turn makes the buying and selling process less competitive compared to listed stocks.

7. Limited Regulatory Requirements: Every investment indeed comes with its own set of risks (and usually regulations), but when it comes to investing in unlisted stocks, the regulatory framework in place allows one to invest with a higher degree of certainty in what they are buying. Regulations for listed stocks are put in place to ensure that there is proper disclosure of information that can help investors make informed decisions – but if they are not able to access that information, then the purpose of those regulations is lost.

These were some mind-blowing advantages of an unlisted stock exchange.

Perseverance is the key to success, and the same goes for buying shares. As they may know it requires a high level of perseverance due to its high-risk levels. It will pay off if they are prepared to go through many failures before finally becoming successful.

One method where patience is required at all times is buying unlisted shares. These are shares that have not been listed on any stock exchange yet, usually because they are too small with too few shareholders. They are sold by companies or by people who want to sell their shares in order for their company to grow further.

Despite the difficulty to buy unlisted shares there are several good reasons for which you should consider doing so, as follows:

1) One can start from a small share portfolio

The first reason is that it is a good investment for those who want to start from small money. It does not matter whether they have five 500 rs or 5000 rs, anybody can buy unregistered stocks and benefit from them. In this way they will be able to build their personal wealth without spending all their savings for it to work.

2) One will meet the company founders

Additionally, by buying unlisted shares they will have the opportunity to personally meet with the company founders and discuss their business plans directly with them. As an investor they are entitled to know what is happening behind the scenes; meetings like these give them access to information that most people don’t know about.

3) They will have the chance to control the company

They are also allowed to vote or nominate directors, which is another incentive for buying shares. This is almost impossible with listed companies but not so with unlisted ones. The more shares they buy, the more voting power they have. If they invest big enough, this gives them a lot of influence over how they run their business.

4) They will benefit from preferential treatment

As an unlisted share owner, they are entitled to certain benefits such as discounts on goods or services offered by the company. Nowadays these types of dealings usually include many more than just physical products. Their value also includes online services such as web hosting or maybe even internet marketing consultation, etcetera.

5) There are no restrictions on selling their shares

Finally, there are no restrictions on selling their unlisted shares at any time that they choose even if it is just five minutes after buying them! With listed shares usually there are many complicated rules and these can make investors unhappy because they feel as though they don’t have total freedom over what they do with them.
Every investment is risky, but this does not mean that they shouldn’t try it out. The unlisted shares list is definitely worth looking into; the only way to get ahead in life is by taking calculated risks and reaping their rewards. One should never be afraid of failure because this will put an end to their investments before they even get started!

Capgemini Technology Services India Ltd. (CTSIL) is a public limited company that was incorporated in the year 1993. It is one of the top companies with large offshore development centres in different parts of the country, including Bangalore, Mumbai, Hyderabad, Chennai, and Pune. It provides customized and packaged application development, outsources services for application maintenance, business intelligence services, and application re-engineering. Through this post, you will get to know everything about the Capgemini shares.

Capgemini was listed on the Bombay Stock of Exchange with the BSE code of 532337, and on the Nifty Stock of Exchange, with the NSE Symbol of IGS and ISIN of INE177B01016. But in the year 2008, CTSIL delisted itself from the Indian Stock Exchanges. The company currently has more than 13,000 shareholders. 

What are the different types of shareholding forms?

• Bearer Form: This is the type of shareholding form in which it is the financial intermediary who holds the bearer’s security accounts. The particular financial intermediary is chosen by the shareholder, and it is the only one to know the real identity of the shareholder. Not even a company like CTSIL is aware of the shareholder’s identity. 

• Registered Form: To make the communication easier between the company (CTSIL) issuing Capgemini unlisted shares and the shareholder, the identity of the specific shareholder is recorded in the books of Capgemini shares issuing company. 

The current valuation of the unlisted shares of Capgemini

Currently, the capgemini share price is Rs. 9000 per share and Earning Per Share (EPS) of the financial year 20-21 stands at 285. Therefore, P/E is 31x. 

How can the shareholders buy the Capgemini Shares?

There are many financial intermediaries through which a shareholder can buy the Capgemini shares. Here is the procedure that is followed by almost every intermediary for buying Capgemini unlisted shares:

1. First, the booking of CTSIL unlisted shares is confirmed with the intermediary at a trading price.
2. Some KYC documents required cording to the SEBI regulations are provided to the financial intermediary such as client master report, PAN Card, Cancelled cheque, and many others. 
3. Bank details are provided to the client by the intermediary so that funds can be transferred to that account.
4. The modes of payment to be used are RTGS/NEFT/IMPS cheque transfer. Cash deposits are not accepted.
5. The same account is to be used for the payment in which shares are to be credited. 
6. At last, purchased shares are transferred in 24 hours in a case when funds are credited before 2 pm.

What is the lock-in period of CTSIL shares?

The lock-in period depends on different categories of investors. 

The lock-in period for Venture Capital Funds or Alternate investment Fund (category 1 or 2) is of 6 months from the date of acquisition of CTSIL unlisted shares.

The lock-in period for other investors is six months from the date of listing of the IPO of CTSIL unlisted shares.

Final Thoughts

Now that you know all about Capgemini shares, especially their current price and procedure of buying these unlisted shares, what are you waiting for? Contact any reputable financial intermediary and buy unlisted shares online.