In the ever-evolving landscape of India’s capital markets, corporate compliance has become a cornerstone of maintaining transparency, investor confidence, and market integrity. One such critical compliance requirement is Regulation 74(5) of the SEBI (Depositories and Participants) Regulations, 2018, which mandates listed companies to confirm the dematerialisation process of securities within a prescribed timeline.

Vishnu Chemicals Limited, a prominent listed company on BSE and NSE, has submitted its quarterly compliance certificate for the period ending June 30, 2025. This document, released on July 5, 2025, certifies that all securities received for dematerialisation during the quarter have been duly verified, mutilated, cancelled, and updated in the company’s register of members with the names of the relevant depositories.

This detailed article explores the entire process, its significance, and the importance of strict adherence to SEBI guidelines.

Understanding Regulation 74(5) of SEBI (Depositories and Participants) Regulations, 2018
Regulation 74(5) is a critical provision that enforces accountability on both companies and their Registrar and Share Transfer Agents (RTA). The regulation requires that whenever a company receives securities for dematerialisation through a depository participant, it must:

• Verify the validity of such certificates.

• Mutilate and cancel the physical certificates to prevent misuse.

• Substitute the name of the depository as the registered owner in the company’s register of members.

• Complete these steps within 15 days of receipt of valid Dematerialisation Request Forms (DRF) and share certificates.

The purpose of this rule is to ensure security, transparency, and integrity in the dematerialisation process. By enforcing these timelines and checks, SEBI prevents fraudulent activities, duplication of share certificates, and errors in ownership records.

Vishnu Chemicals Limited’s Compliance for June 2025 Quarter
Vishnu Chemicals Limited, a leading player in the chemical sector, has ensured compliance with these stringent requirements for the quarter ending June 30, 2025.

In its filing dated July 5, 2025 (reference VCL/SE/29/2025-26), addressed to both BSE Limited and National Stock Exchange of India Limited, the company submitted the certificate received from its RTA, M/s. Bigshare Services Private Limited.

This certificate serves as a formal confirmation that:

• All securities received from depository participants during the quarter were duly verified.

• Dematerialisation requests were either accepted or rejected in line with depository rules.

• The physical share certificates were properly mutilated and cancelled to prevent misuse.

• The depositories’ names (NSDL and CDSL) were substituted in the register of members as the registered owners within the mandated 15-day period.

This meticulous process ensures that investor records remain secure, accurate, and tamper-proof.

Role of Bigshare Services Private Limited
Bigshare Services Private Limited acts as the Registrar and Share Transfer Agent for Vishnu Chemicals Limited. As an RTA, it plays a pivotal role in maintaining shareholder records and ensuring compliance with SEBI’s guidelines.

Their responsibilities include:

• Receiving dematerialisation requests from depository participants.

• Verifying authenticity of share certificates and DRFs.

• Processing approvals or rejections.

• Communicating results to NSDL and CDSL.

• Ensuring prompt destruction of cancelled certificates.

• Updating the company’s register of members with the correct depository details.

Their certificate of compliance serves as an assurance to the stock exchanges, regulators, and investors that Vishnu Chemicals is adhering to the highest standards of regulatory compliance.

Importance of SEBI Regulation 74(5) Compliance
Strict compliance with Regulation 74(5) offers multiple benefits:

• Investor Protection: Prevents fraudulent duplication or misuse of share certificates.

• Market Integrity: Ensures accurate ownership records for listed securities.

• Operational Efficiency: Streamlines transfer and dematerialisation processes.

• Regulatory Transparency: Enhances confidence among investors and regulators.

• Avoidance of Penalties: Non-compliance can lead to fines, reputational damage, and regulatory action.

For investors, these filings signal that the company is serious about governance and shareholder protection.

Vishnu Chemicals Limited’s Broader Compliance Culture
This filing is part of Vishnu Chemicals Limited’s ongoing commitment to corporate governance. Beyond Regulation 74(5), the company also:

• Regularly submits quarterly and annual financial statements.

• Discloses material events promptly to stock exchanges.

• Holds Annual General Meetings (AGM) as per Companies Act requirements.

• Ensures Board independence and audit oversight.

• Adopts best practices in investor relations.

Such a compliance-first approach positions the company as a responsible and trustworthy corporate citizen.

Investor Communication and Stock Exchange Requirements
Stock exchanges like BSE and NSE require timely filings to maintain a transparent market. SEBI’s Listing Obligations and Disclosure Requirements (LODR) mandate that companies inform exchanges of compliance with various regulations.

By uploading the RTA’s certificate to BSE Listing Centre and NEAPS (NSE’s platform), Vishnu Chemicals ensures:

• Equal access to information for all stakeholders.

• Regulatory audit trail for inspections.

• Investor confidence in the company’s processes.

This level of transparency is vital for listed entities operating in India’s highly regulated capital markets.

Conclusion
Vishnu Chemicals Limited’s submission of its Regulation 74(5) certificate for the June 2025 quarter underscores its commitment to good governance and investor protection. The company’s proactive approach to SEBI compliance not only meets legal requirements but also fosters trust and credibility in the market.

Such disclosures are not mere formalities but reflect a strong culture of accountability, ensuring that the interests of shareholders and the integrity of India’s financial system remain safeguarded.

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