Today’s agenda is to discuss how to buy unlisted shares in Zerodha. But before we pick this topic, we should understand what is unlisted shares and how it works.
An unlisted share is the shares of the nonlisted companies. It can available over the counter or via brokers. As these companies are not listed hence could be new to the market and not meet the listing criteria of SEBI. However, they have huge potential to grow but there are high chances of risk involved due to lesser regulations in place.
In general, unlisted companies cannot trade on any formal stock exchange. But they too need capital to run the business or expand the same. Therefore, these unlisted shares come into the picture. Earlier, there was the OTC Exchange of India which facilitate the trading of stocks for small businesses. However, the same has shut down long back. Moreover, if someone is interested in high growth opportunities then one can definitely give a thought to buying unlisted shares.
At the nascent stage. unlisted shares provide an excellent investment opportunity. As it focuses on long-term wealth creation. As a result, the returns can definitely beat returns by listed equities
Here are the top-rated unlisted shares on the basis of company performance in the past few years:
|1||HDB Financial Services Limited|
|2||Motilal Oswal Home Finance|
|3||Reliance Retail Limited|
|4||HDFC Securities Limited|
|6||Religare Health Care|
|7||Kurlon Enterprise Limited|
|8||UTI AMC LIMITED|
|9||Tata Technology Limited|
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To buy unlisted shares, one should have a Demat account so that post buying the shares you can hold those securities in Demat form. To hold the securities in Demat, it is not necessary that securities have to be listed only. As long as securities are in the custody of CDSL/NSDL you can hold them in Demat account.
As the shares are not listed hence you will not be able to trade unless another buyer is available to buy them or the company gets listed on a formal stock exchange. Hence, it comes with illiquidity so must consider this factor while buying the same.
Well, you cannot buy unlisted shares via Zerodha as it regards as a bid that is against the spirits of regulations outlined by SEBI the regulator. However, once you buy the unlisted shares you can hold them in electronic form with Zerodha Demat account.
Don’t get disheartened as there are many private players in the market that facilitate the trading of unlisted shares. We are not recommending these players but in case you would like to try your luck. Then here is the list of platforms that helps in buying and selling unlisted shares:
These platform acts as intermediaries to buy shares from employees( ESOPS), promoters, existing investors and offers to new investors who are keen on the unlisted share market. Thus, it opens gates for retail investors and sets a stage between buyer and seller. However, it’s very important that you deal with trustworthy intermediaries to avoid any counterparty risk to avoid any scams or frauds.
Once you have narrowed down your decision to the best platform to buy ensure you select the company after having understood its business model, management tea, their financial performance over the years, current valuation and always check their potential to get listed on the formal stock exchange for easy liquidity.