The major requisite to shut a demat account is that the steadiness within the account ought to be nil. This implies that you need to exit or switch all of the shares held in that account. Do test you probably have shares of firms which are now not listed out there. The course of to exit such shares is comparatively simpler in instances the place firms delist from the inventory exchanges voluntarily.
“If the corporate delists voluntarily, the account holder will get one 12 months time to strategy the RTA (Registered Transfer Agent) and tender the shares by way of an offline course of. The firm must honour the delisting value. If the corporate has been delisted for over a 12 months, the shareholder can strategy the corporate and enter into a personal negotiation to promote the shares again to the promoters. This might be an off-market transaction and the value might be decided between the client and vendor,” said a spokesperson for ICICIdirect .
The account holder also has the option to re-materialise the shares by converting them from electronic to paper form. For this, they have to approach their DP (Depository Participant) with a re-materialisation request for each of the company they hold a share of. The ICICIdirect spokesperson said this is a long drawn process and can take about 4-6 weeks, depending on the company.
However, re-materialisation will not go through if the company doesn’t respond, which typically happens when the company is involuntarily delisted. In such cases, the customer can transfer the balance to a different demat account using a delivery instruction slip.
The same procedure is to be followed for listed shares with thin trading volumes, making it difficult for the investor to sell them. “The investor will have to keep trying online to sell them. Alternatively, they can gift those shares or transfer the balance to another demat account,” stated a Zerodha spokesperson.
There is also situations the place an investor holds shares of an entity which isn’t listed–within the type of ESOPs or by the use of demerger from a listed entity. The investor can shed such shares solely by way of off-market transactions. “Such buyers can get in contact with specialised brokers who cope with unlisted shares,” the ICICIdirect spokesperson stated.
Once the steadiness is nil, the account holder can shut the account on-line. “The buyer has to go to DP workplace in the event that they don’t have an Aadhaar-linked cellular to signal closure request, if it’s a joint demat account, or if account is a non-individual one,” stated the spokesperson for Zerodha.
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