Overview of Core investment company

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Core

• Investment Company

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A Core Investment Company (CIC) is categorized
as a Non Banking Financial Company (NBFC) by the
Reserve Bank of India (RBI). These companies
predominately invest in shares of its own group
companies for stakeholding but cannot engage in
trading of these instruments or carry out any
other kind of financial activity.
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CATEGORIES OF CORE INVESTMENT COMPANY
Registered CICs with assets less than Rs. 100
crore worth follow the norms specified in the
Non-Systematically Important NBFC Prudential
Norms, 2015.
For those with assets more than Rs. 100 core
follows the norm as specified in Systematically
Important NBFC Prudential Norms Directions,
2015.
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Approval Requirements for Core Investment
Company
All Core Investment Companies are required to be
registered with the Reserve Bank of India under
section 45 IA of the RBI Act 1934 and thereby
obtain a Certificate of Registration.
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The investment of the company in the shares of
the group companies need to be at least 60 of
the net worth of its assets.
General Obligation for a Core Investment
Company
The Core Investment Company is not allowed to
carry out any other financial activity other
than,the company can issue guarantees on behalf
of group companies
It cannot trade in its investments in shares,
bonds, debentures, debt or loans in group
companies except through block sale with the
purpose of diluting or disinvestment.
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THE PROCESS OF REGISTRATION OF CORE INVESTMENT
COMPANY
The Core Investment Company needs to download
the application form for registration from the
website of RBI.
It needs to be filled in and submitted to the
Regional Office of DNBS (Department of
Non-Banking Supervision) along with the
supporting documents as mentioned in the form.
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