Disclaimer

MANAGEMENT OF CONFLICTS OF INTEREST AND DISCLOSURE REQUIREMENTS

Establishing internal policies and procedures.

(1) 777 Trades Research Investment Advisor shall have written internal policies and control procedures governing the dealing and trading by any research analyst for:

  • i. addressing actual or potential conflict of interest arising from such dealings or trading of securities of subject company
  • ii. promoting objective and reliable research that reflects the unbiased view of research analyst
  • iii. preventing the use of research report or research analysis to manipulate the securities market.
  • (2) 777 Trades Research shall have in place appropriate mechanisms to ensure independence of its research activities from its other business activities.

    Limitations on trading by research analysts.

    2. (1) Personal trading activities of the individuals employed as research analyst by 777 Trades Research Investment Advisor shall be monitored, recorded and whenever necessary, shall be subject to a formal approval process.

    (2) 777 Trades Research Investment Advisor or any of its associates or fellow research analyst shall not deal or trade in securities recommended/followed by 777 Trades Research Investment Advisor or its fellow research analyst within thirty days before and five days after the publication of a research report.

    (3) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not deal or trade directly or indirectly in securities that we review in a manner contrary to our given recommendations.

    (4) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts will not purchase or receive securities of the issuer before the issuer’s initial public offering, if the issuer is principally engaged in the same types of business as companies that we follow or recommend.

    (5) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall completely segregate research activities and maintain an arms-length relationship between any other activities.

    (6) Notwithstanding anything contained in sub-regulations (2) to (4), such restrictions to trade or deal in securities may not apply in case of significant news or event concerning the subject company or based upon an unanticipated significant change in employee’s personal financial circumstances, 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall take prior written approval as per the terms specified in the approved internal policies and procedures.

    Compensation of research analysts.

    3. (1) 777 Trades Research Investment Advisor shall not receive / pay any bonus, salary or other form of compensation to any individual employed as research analyst that is determined or based on any specific merchant banking or investment banking or brokerage services transaction.

    (2) The compensation of all individuals employed as research analyst by 777 Trades Research Investment Advisor will be reviewed, documented and approved annually by board of directors/committee appointed by board of directors of 777 Trades Research and will not consist of representation from its merchant banking or investment banking or brokerage services divisions.

    (3) The board of directors/committee appointed by board of directors of the 777 Trades Research Investment Advisor approving or reviewing the compensation of individual employed as research analyst shall not take into account such individual’s contribution to 777 Trades Research Investment Advisor banking or merchant banking or brokerage services business.

    (4) An individual employed as research analyst by 777 Trades Research Investment Advisor shall not be subject to the supervision or control of any employee of the merchant banking or investment banking or brokerage services divisions of 777 Trades Research Investment Advisor.

    Limitations on publication of research report, public appearance and conduct of business, etc.

    4. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not publish or distribute research report or research analysis or make public appearance regarding a subject company for which it has acted as a manager or co-manager at any time falling within a period of:

  • (a) Forty days immediately following the day on which the securities are priced if the offering is an initial public offering; or
  • (b) Ten days immediately following the day on which the securities are priced if the offering is a further public offering.
  • Provided that 777 Trades Research Investment Advisor or any of its associates or fellow research analysts may publish or distribute research report or research analysis or make public appearance within such forty day and ten day periods, subject to prior written approval of legal or compliance personnel as specified in the internal policies and procedures.

    (2) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts who has agreed to participate or is participating as an underwriter of an issuer’s initial public offering shall not publish or distribute a research report or make public appearance regarding that issuer before expiry of twenty five days from the date of the offering.

    Explanation- For the purposes of sub-regulations (1) and (2), the date of the offering refers to the first date on which the security was offered to the public.

    (3) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts who has acted as a manager or co-manager of public offering of securities of a company shall not publish or distribute a research report or make a public appearance concerning that company within fifteen days prior to date of entering into the fifteen days after the expiration/waiver/termination of a lock-up agreement or any other agreement that 777 Trades Research Investment Advisor or any of its associates or fellow research analysts have entered into with a subject company that restricts or prohibits the sale of securities held by the subject company after the completion of public offering of securities :

    Provided that 777 Trades Research Investment Advisor or any of its associates or fellow research analysts may publish or distribute research report or research analysis or make public appearance regarding that company within such fifteen days subject to prior written approval of legal or compliance personnel as specified in the internal policies and procedures.

    (4) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not participate in business activities designed to solicit investment banking or merchant banking or brokerage services business, such as sales pitches and deal road shows.

    (5) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not engage in any communication with a current or prospective client in the presence of personnel from investment banking or merchant banking or brokerage services divisions or company management about an investment banking services transaction.

    (6) Investment banking or merchant banking or brokerage services division’s personnel of 777 Trades Research Investment Advisor shall not direct research analysts or fellow research to engage in sales or marketing related to an investment banking or merchant banking or brokerage services and shall not direct us to engage in any communication with a current or prospective client about such division’s transaction:

    Provided that sub-regulations (4) to (6) shall not prohibit 777 Trades Research Investment Advisor, its associates or fellow research from engaging in investor education activities including publication of pre-deal research and briefing their views on the transaction to the sales or marketing personnel.

    (7) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall have adequate documentary basis, supported by research, for preparing a research report.

    (8) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not provide any promise or assurance of favorable review in its research report to a company or industry or sector or group of companies or business group as consideration to commence or influence a business relationship or for the receipt of compensation or other benefits.

    (9) 777 Trades Research Investment Advisor or any of its associates or fellow research shall not issue a research report that is not consistent with its or its associates or fellow research’s view regarding a subject company.

    (10) 777 Trades Research Investment Advisor or any of its associates or fellow research shall ensure that the individuals employed as research analyst are separate from other employees who are performing sales trading, dealing, corporate finance advisory or any other activity that may affect the independence of its research report:

    Provided that 777 Trades Research Investment Advisor or any of its associates or fellow research can receive feedback from sales or trading personnel of brokerage division to ascertain the impact of research report.

    Disclosures in research reports.

    5. 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall disclose all material information about itself including its business activity, disciplinary history, the terms and conditions on which it offers research report, details of associates and such other information as is necessary to take an investment decision, including the following :

  • (i) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall disclose the following in research report and in public appearance with regard to ownership and material conflicts of interest :
  • (a) Whether 777 Trades Research Investment Advisor, its associates or fellow research analysts or its associate or its relative has any financial interest in the subject company and the nature of such financial interest;
    (b) Whether 777 Trades Research Investment Advisor, its associates or fellow research analysts or its relatives, have actual/beneficial ownership of one percent or more securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance
    (c) Whether 777 Trades Research Investment Advisor, its associates or fellow research analysts or its associate or its relative, have any other material conflict of interest at the time of publication of the research report or at the time of public appearance
  • (ii) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall disclose the following in research report with regard to receipt of compensation
  • (a) Whether 777 Trades Research Investment Advisor or its associates have received any compensation from the subject company in the past twelve months
    (b) Whether 777 Trades Research Investment Advisor or its associates have managed or co-managed public offering of securities for the subject company in the past twelve months
    (c) Whether 777 Trades Research Investment Advisor or its associates have received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months
    (d) Whether 777 Trades Research Investment Advisor or its associates have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months
    (e) Whether 777 Trades Research Investment Advisor or its associates have received any compensation or other benefits from the subject company or third party in connection with the research report.
  • (iii) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall disclose the following in public appearance with regard to receipt of compensation:
  • (a) Whether 777 Trades Research Investment Advisor and its associates have received any compensation from the subject company in the past twelve months;
    (b) Whether the subject company is or was a client during twelve months preceding the date of distribution of the research report and the types of services provided :
    Provided 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not be required to make a disclosure as per sub-clauses (c), (d) and (e) of clause (ii) or sub-clauses (a) and (b) of clause (iii) to the extent such disclosure would reveal material non-public information regarding specific future investment banking or merchant banking or brokerage services transactions of the subject company.
  • (iv) whether 777 Trades Research Investment Advisor or any of its associates or fellow research analysts has served as an officer, director or employee of the subject company
  • (v) whether the 777 Trades Research Investment Advisor or any of its associates or fellow research analysts entity has been engaged in market making activity for the subject company
  • (vi) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall provide all other disclosures in research report and public appearance as specified by the Board under any regulations.
  • Contents of research report.

    6. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall take steps to ensure that facts in its research reports are based on reliable information and shall define the terms used in making recommendation, and these terms shall be consistently used.

    (2) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts that employs a rating system must clearly define the meaning of each such rating including the time horizon and benchmarks on which a rating is based.

    (3) If a research report contains either a rating or price target for subject company’s securities and 777 Trades Research Investment Advisor or any of its associates or fellow research analysts has assigned a rating or price target to the securities for at least one year, such research report shall also provide the graph of daily closing price of such securities for the period assigned or for a three year period, whichever is shorter.

    Recommendations in public media.

    7. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts including director or employee shall disclose the registration status and details of financial interest in the subject company, if they makes public appearance.

    (2) If any person including a director or employee of 777 Trades Research Investment Advisor or credit rating agency or asset management company or fund manager, makes public appearance or makes a recommendation or offers an opinion concerning securities or public offers through public media, all the provisions of regulations 16 and 17 shall apply mutatis mutandis to him and he shall disclose his name, registration status and details of financial interest in the subject company at the time of,-

  • (i) making such recommendation or offering such opinion in personal capacity
  • (ii) responding to queries from audiences or journalists in personal capacity
  • (iii) communicating the research report or substance of the research report through the public media.
  • Distribution of research reports.

    8. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall not make a research report available selectively to internal trading personnel or a particular client or class of clients in advance of other clients who are entitled to receive the research report.

    (2) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts who distributes any third party research report shall review the third party research report for any untrue statement of material fact or any false or misleading information.

    (3) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts who distributes any third party research report shall disclose any material conflict of interest of such third party research provider or we shall provide a web address that directs a recipient to the relevant disclosures.

    (4) Provisions of sub-regulations (2) and (3) shall not apply to 777 Trades Research Investment Advisor or any of its associates or fellow research analysts if we have no direct or indirect business or contractual relationship with such third party research provider.

    Additional disclosures by proxy adviser.

    9. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall abide by all the provisions of Chapter II, III, IV, V and VI mutatis mutandis in case they act as a proxy adviser

    Provided that its employees, when we acting as a proxy advisor, who are engaged in providing proxy advisory services shall be required to have a minimum qualification of being a graduate in any discipline:

    Provided further that certification requirements for its employees, when I or any of my associates or fellow research analysts act as a proxy advisors, engaged in providing proxy advisory services shall be as specified by the Board:

    Provided further that the time period for compliance with capital adequacy as provided in sun-regulation (3) of regulation 8, for proxy advisors shall be three years.

    (2) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts acting as a proxy adviser shall additionally disclose the following:

  • (i) the extent of research involved in a particular recommendation and the extend and/or effectiveness of its controls and procedures in ensuring the accuracy of issuer data
  • (ii) policies and procedures for interacting with issuers, informing issuers about the recommendations and review of recommendations
  • (3) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts acting as a Proxy adviser shall maintain the record of our voting recommendations and furnish the same to the Board on request.

    (4) In case of any inconsistency or difficulty in respect of applicability of provisions of these regulations to 777 Trades Research Investment Advisor or any of its associates or fellow research analysts acting as a Proxy adviser, the Board may issue such clarifications or exemptions as may be deemed appropriate.

    General Responsibility

    10. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall maintain an arms-length relationship between its research activity and other activities.

    (2) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall abide by Code of Conduct as specified in Third Schedule.

    (3) In case of change in my or any of its associates or fellow research analysts control, prior approval from the Board shall be taken,

    (4) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall furnish to the Board information and reports as may be specified by the Board from time to time.

    (5) 777 Trades Research Investment Advisor shall be the responsible to ensure that itself or any of its associates or fellow research analysts shall comply with the certification and qualification requirements under regulation 7 at all times.

    Maintenance of records.

    11. (1) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall maintain the following records:

  • (i) research report duly signed and dated;
  • (ii) research recommendation provided
  • (iii) rationale for arriving at research recommendation
  • (iv) record of public appearance.
  • (2) All records shall be maintained either in physical or electronic form and preserved for a minimum period of five years:

    Provided that where records are required to be duly signed and are maintained in electronic form, such records shall be digitally signed.

    (3) 777 Trades Research Investment Advisor or any of its associates or fellow research analysts shall conduct annual audit in respect of compliance with these regulations from a member of Institute of Chartered Accountants of India or Institute of Company Secretaries of India.

    Appointment of compliance officer.

    12. 777 Trades Research Investment Advisor or any of its associates or fellow research analysts which is a body corporate or limited liability partnership firm shall appoint a compliance officer who shall be responsible for monitoring the compliance of the provisions of the Act, these regulation and circulars issued by the Board.

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