Equity Funding Consultant in India: The National Guide to Raising Equity, Valuation and FEMA Compliance

An equity funding consultant in India guides a company through every step of raising equity: deciding how much to raise and from whom, preparing the company for investor scrutiny, valuing the shares correctly, structuring the cap table and term sheet, and completing the Companies Act and FEMA filings that make the round legally valid. This is the national guide to that process, written by Marcken Consulting LLP for founders, promoters and finance heads who want the full regulatory picture in one place.

Indian equity rounds are governed by several regimes at once: the Companies Act, 2013, the FEM (Non-Debt Instruments) Rules, 2019, SEBI regulations where funds or listed companies are involved, and the Income-tax law. A mistake in any one of them can invalidate an allotment, delay closing or create a compliance penalty after the money has been received. This page is the national hub of Marcken Consulting LLP’s Equity Funding Consultant series. It sets out what each regime requires and which valuation report applies to which round, and it links to the eight city guides that apply the same framework to the local Registrar, RBI, SEBI and NCLT offices and to the investor ecosystem of each city.

Start Here: How This Guide Fits the Equity Funding Consultant Series

The rules described in this guide, the Companies Act, FEMA, SEBI and Income-tax provisions, apply to every equity round in India, whichever city the company is in. What changes from city to city is local: the Registrar of Companies whose office receives your PAS-3, the RBI regional office, the SEBI and NCLT offices, and the investor ecosystem you will actually raise from. This pillar guide covers the framework once; each city guide then applies it to a specific hub.

1. Read the framework here first: Sections 3 to 7 cover the legal regimes, valuation reports, FEMA and the domestic Companies Act sequence.
2. Open the guide for your city: each one adds the local regulator offices, the state startup and funding context, and the sectors that dominate that city’s rounds.
3. Return to the Quick Reference table and checklist: at the end of this page they summarise what your specific round requires.

Choose your city guide:

• Ahmedabad: Gujarat companies and ROC Ahmedabad filings.
• Mumbai: Maharashtra companies and Mumbai’s financial-services investor base.
• Bangalore: Karnataka’s technology and venture-backed startup ecosystem.
• Delhi NCR: including the February 2026 ROC restructuring for Delhi, Haryana and Noida.
• Chennai: Tamil Nadu’s SaaS, manufacturing and financial-services companies.
• Hyderabad: Telangana’s pharma, technology and growth companies.
• Jaipur: Rajasthan’s export-led family businesses and iStart Rajasthan.
• Kolkata: West Bengal, ROC Kolkata-I and Kolkata-II, and promoter-led trading houses.

1. What an Equity Funding Consultant in India Does

The role sits between the founder, the investor, the valuer and the regulator. A capable consultant does not simply introduce investors; the value lies in making the round investable, correctly priced and compliant. In practice, the engagement covers six areas:

• Investor readiness: audited financials, a reconciled cap table, a clean allotment history and a financial model that will stand up to due diligence.
• Valuation and pricing: identifying whether a Registered Valuer report, a FEMA Rule 21 fair value certificate, or both, is required, and supporting the pre-money valuation with a documented method.
• Cap table and instrument design: equity shares versus CCPS or CCDs, ESOP pool sizing, dilution across scenarios and promoter-block presentation.
• Term sheet review: reading each clause for its regulatory as well as commercial consequences, in coordination with legal counsel.
• Regulatory sequencing: resolutions, allotment, PAS-3, FC-GPR, FC-TRS and demat requirements, in the right order and within the statutory deadlines.
• Post-closing support: ESOP administration, later rounds, and pre-IPO preparation when the company is ready.

A consultant who handles only introductions leaves the founder to discover the valuation and FEMA requirements after signing a term sheet, which is the most expensive time to discover them. A consultant who handles only compliance leaves the commercial structure unexamined. Marcken Consulting LLP delivers both dimensions as one coordinated engagement, with the valuation and the filings prepared by the same team.

2. The Indian Equity Funding Landscape: Stages and Investors

Equity capital in India is raised in stages, and each stage brings different investors, different instruments and different regulatory pressure points. The table below summarises the usual pattern; actual rounds vary by sector and by the investor’s mandate.

Stage	Typical Investors	Common Instruments	Regulatory Focus
Pre-seed and seed	Founders’ network, angels, angel networks, early-stage funds, government-backed programmes	Equity shares, CCPS, convertible notes or SAFE-style instruments	Clean incorporation records, valuation for the first allotment, DPIIT recognition where relevant
Series A and B	Venture capital funds, including foreign funds	CCPS with investor rights, sometimes CCDs	Registered Valuer report for domestic investors, Rule 21 certificate and FC-GPR for foreign investors, shareholder agreement, ESOP pool
Growth and private equity	Private equity funds, family offices, strategic and corporate investors	Equity, CCPS, structured instruments	Beneficial-ownership checks, sector caps, secondary transfers, FC-TRS, board and governance rights
Pre-IPO	Crossover funds, private equity, existing investors	Equity, CCPS converting before listing	Preferential allotments before the DRHP, lock-in, valuation support, capital structure clean-up

2.1 Sources of Equity Capital

• Angel investors and angel networks: individuals and syndicates who invest early, usually in resident hands, so the domestic Companies Act sequence applies.
• Venture capital funds: domestic funds registered as SEBI Alternative Investment Funds, and foreign funds investing under the FEMA regime.
• Private equity and family offices: larger cheques for established, often promoter-led, businesses, typically with governance rights and a defined exit horizon.
• Strategic and corporate investors: customers, suppliers or peers that take equity, including foreign parents and partners; every allotment to a non-resident triggers FEMA valuation and reporting.
• Government-backed programmes: central and state startup schemes provide grants, incubation and sometimes equity through funds; grants involve no allotment, while an equity investment does. The DPIIT recognition process is described on the Startup India portal.

2.2 A Note on Angel Tax

Section 56(2)(viib) of the Income-tax Act, 1961, the provision popularly called angel tax, no longer applies to share issues from assessment year 2025-26, having been abolished by the Finance (No. 2) Act, 2024. Proceedings for earlier years continue under the old law. The abolition does not remove the need for a defensible valuation: the Companies Act and FEMA pricing rules described below still apply, and investors expect a documented method.

3. The Legal Framework for an Equity Round in India

Law or Regulator	What It Governs in an Equity Round	Key Requirement
Companies Act, 2013	Issue of shares, private placement, preferential allotment, ESOPs	Section 62(1)(c) special resolution, Registered Valuer report under Rule 13, allotment within 60 days, Form PAS-3 within 15 days
FEM (Non-Debt Instruments) Rules, 2019	Investment by non-residents in Indian companies	Entry route and sectoral caps, pricing under Rule 21, FC-GPR within 30 days, FC-TRS for transfers within 60 days
DPIIT (FDI Policy, Press Note 2 of 2026)	Investment from countries sharing a land border with India	Beneficial-ownership test, prior government approval in specified cases
SEBI	Registered funds (AIFs), Merchant Bankers, listed companies and IPOs	AIF Regulations for domestic funds; Merchant Banker registration for specified certificates; ICDR for public issues
Income-tax law	Perquisite tax on ESOPs, tax treatment of transfers	Merchant Banker FMV for unlisted-share ESOP perquisite; current valuation rules for transfers
Ministry of Corporate Affairs	Filings, demat rules, Registrar offices	Rule 9B demat for private companies that are not small, half-yearly PAS-6

These regimes are the same in every city; the city guides in this series apply them to the local Registrar, RBI, SEBI and NCLT offices. The sections that follow cover each in detail. For a full treatment of valuation reports and signatories, see Business Valuation in India: The Complete Regulatory Guide.

4. How to Raise Equity Funding in India: A Step-by-Step Roadmap

1. Define the raise: the amount, the use of proceeds, the runway it buys and the dilution you can accept. Model the dilution before any investor conversation.
2. Get investor-ready: two to three years of audited accounts, a reconciled cap table with every past allotment supported by resolutions and filings, dematerialised shares where Rule 9B applies, and a three-to-five year financial model.
3. Choose the instrument and the investor mix: equity, CCPS or CCD, and whether any investor is a non-resident. Residency decides which valuation and filings follow.
4. Obtain the correct valuation: a Registered Valuer report for a domestic preferential allotment, and a Rule 21 fair value certificate, not more than 90 days old at the date of investment, for any non-resident investor.
5. Negotiate and sign the term sheet: with regulatory review of valuation, liquidation preference, ESOP pool, exit rights and transfer provisions.
6. Complete diligence and definitive documents: subscription agreement, shareholders’ agreement and articles amendments.
7. Pass the resolutions and receive the funds: board resolution, EGM special resolution with explanatory statement, and receipt of subscription money in a separate bank account through banking channels.
8. Allot and file: allotment within 60 days of receiving the money, PAS-3 within 15 days, and, for foreign investment, FC-GPR on the RBI FIRMS portal within 30 days of allotment.
9. Update records and plan the next round: statutory registers, cap table, ESOP ledger and a compliance calendar for the next raise.

5. Valuation for an Equity Round: Which Report, Which Signatory

An incorrect or missing valuation is a frequent cause of delay in an Indian equity round. The right report depends on who the investor is and what is being issued:

Situation	Governing Provision	Report Required	Who Signs
Domestic preferential allotment (all investors resident)	Section 62(1)(c) and Rule 13, Companies (Share Capital and Debentures) Rules, 2014	Valuation report	IBBI Registered Valuer
Issue to any non-resident by an unlisted company	Rule 21, FEM (Non-Debt Instruments) Rules, 2019	Fair value certificate under an internationally accepted pricing methodology, arm’s-length basis, not more than 90 days old	Chartered Accountant, SEBI-registered Merchant Banker or practising Cost Accountant
CCD or CCPS issued to a non-resident	Rule 21 at issuance	Certificate at issuance only; conversion price or formula fixed upfront and not below issuance-date fair value	Same as above
ESOP exercise (unlisted company)	Income-tax provisions for perquisite tax	FMV at exercise	SEBI Category I Merchant Banker

Under Rule 21, a DCF valuation is not mandatory; any internationally accepted pricing methodology on an arm’s-length basis qualifies, and the certificate is a floor: shares cannot be issued to a non-resident below it. Where a term sheet or the investor’s counsel specifically calls for Merchant Banker certification, that becomes the requirement for the round. CA Murli Chandak, an IBBI-registered valuer (Securities or Financial Assets), signs Registered Valuer reports on behalf of Marcken Consulting LLP, which also signs FEMA Rule 21 fair value certificates as a practising Chartered Accountant firm, arranging Merchant Banker certification separately only where an investor’s term sheet specifically requires it.

5.1 Valuation Methods Used in Practice

• Discounted cash flow (DCF): the standard for growing companies with credible projections; the model must be built to ICAI Valuation Standards with documented assumptions.
• Net asset value (NAV): relevant for asset-heavy businesses and holding companies.
• Comparable company or transaction multiples: used as a cross-check or as the primary method where reliable market comparables exist.
• Price of recent investment and option-pricing approaches: used for later rounds and complex capital structures; see our guide to SAFE and convertible note valuation in India.

6. FEMA Compliance for Foreign Investment

6.1 The Sequence for a Foreign Round

Where any investor is a non-resident, whether a foreign VC or PE fund, a foreign parent, a strategic partner or an NRI, the Companies Act sequence applies in full, plus the following FEMA steps, set out in the RBI Master Direction on Foreign Investment in India:

1. Confirm the entry route and sectoral caps under the FDI Policy. Most sectors are open under the automatic route subject to caps and conditions; regulated financial activities such as NBFCs carry specific conditions.
2. Check land-border beneficial ownership (Section 6.2 below).
3. Obtain the Rule 21 fair value certificate, signed by a Chartered Accountant, a SEBI-registered Merchant Banker or a practising Cost Accountant, not more than 90 days old at the date of investment.
4. Receive subscription money through banking channels; the AD bank’s FIRC evidences the inward remittance.
5. Allot within 60 days of receiving the remittance.
6. File Form FC-GPR on RBI’s FIRMS portal through the AD bank within 30 days of allotment.

A late filing attracts a Late Submission Fee under the RBI reporting framework, and unregularised delays can lead to compounding proceedings. For secondary transfers between residents and non-residents, Form FC-TRS is due within 60 days of the transfer or of receipt or remittance of the funds, whichever is earlier.

6.2 Land-Border Investors After Press Note 2 (2026)

DPIIT Press Note 2 (2026 Series), issued by DPIIT on 15 March 2026, replaced the blanket approval requirement of Press Note 3 (2020) with a beneficial-ownership approach for investments involving countries that share a land border with India. Beneficial ownership is assessed by reference to the 10 per cent threshold in Rule 9(3) of the PML Rules and to control rights. Broadly, an investment in which land-border beneficial ownership exceeds the threshold, or which carries control rights, requires prior government approval; other investments may proceed on the automatic route where the sector permits, subject to reporting under the DPIIT procedure.

Approvals are filed through the Foreign Investment Facilitation portal on the National Single Window System. DPIIT’s Standard Operating Procedure dated 4 May 2026 provides for a paperless mechanism and, under Schedule II, a 60-day decision timeline for specified manufacturing sectors where the land-border investor holds up to 49% and Indian residents hold majority ownership and control. Confirming the ultimate beneficial owner of every proposed investor, including funds with multiple limited partners, before signing the term sheet is a practical pre-closing step.

6.3 Convertible Instruments Under FEMA

Compulsorily Convertible Debentures and Compulsorily Convertible Preference Shares are treated as equity from the date of issuance, carrying the same Rule 21 pricing, entry-route and FC-GPR obligations as a direct equity issue. The conversion price or formula must be fixed at issue, the price at conversion cannot be lower than the fair value determined at issuance, and no fresh Rule 21 certificate is needed at conversion. Instruments that are not compulsorily convertible do not qualify as equity for FEMA purposes and fall under a different regulatory framework, so the choice of instrument must be settled before the term sheet, not after.

7. Companies Act Compliance for a Domestic Round

An unlisted private limited company raising equity from resident investors follows this sequence: board resolution approving the issue and calling an EGM; Registered Valuer report under Rule 13; special resolution at the EGM with an explanatory statement; a separate bank account for subscription money; ISIN and demat setup where applicable; allotment within 60 days of receipt of funds; and Form PAS-3 with the Registrar of Companies within 15 days of allotment.

7.1 Dematerialisation Under Rule 9B

Rule 9B of the Companies (Prospectus and Allotment of Securities) Rules, 2014 applies to private companies that are not small companies. From 1 December 2025, a small company means one with paid-up capital of up to Rs 10 crore and turnover of up to Rs 100 crore, and holding and subsidiary companies cannot qualify. Companies covered by the rule must issue securities only in dematerialised form and facilitate dematerialisation of existing holdings. The last extended compliance date, 30 June 2025, has passed, and half-yearly Form PAS-6 applies. Companies preparing for a round should treat demat as a pre-condition, not a closing item.

8. Cap Table Design and Dilution

The cap table is the founder’s balance sheet for control. Decisions made in a term sheet, particularly around the ESOP pool, determine who bears the dilution. The illustration below uses round figures to show how a pool created before the investment changes the effective valuation for existing shareholders.

Item	Without ESOP Pool	With 10% Pool Created Pre-Money
Pre-money valuation (headline)	Rs 40 crore	Rs 40 crore
Investment	Rs 10 crore	Rs 10 crore
Post-money valuation	Rs 50 crore	Rs 50 crore
Investor ownership (10 / 50)	20%	20%
ESOP pool (share of post-money)	0%	10%
Existing shareholders’ ownership	80%	70%
Effective pre-money for existing shareholders	Rs 40 crore (80% of Rs 50 crore)	Rs 35 crore (70% of Rs 50 crore)

The illustration is arithmetic on assumed figures, not a market benchmark. It shows why the size and timing of the pool are negotiated points: a 10% pool created pre-money reduces the effective pre-money value for existing shareholders by Rs 5 crore in this example. Beyond the pool, cap table design covers equity versus convertible instruments, the effect of each on the FEMA entry route, anti-dilution and liquidation preference, and, for family-owned businesses, how promoter holdings across family members and group entities are presented so that the investor sees a clear promoter block.

9. Term Sheet Provisions With Regulatory Consequences

• Pre-money valuation: sets the Rule 21 floor for any non-resident co-investor and the basis for the Registered Valuer report in a domestic round.
• Liquidation preference and CCPS classification: the instrument’s classification interacts with its FEMA treatment.
• Conversion terms: the conversion price or formula must be fixed at issue and cannot be below issuance-date fair value for non-resident holders.
• Drag-along, tag-along, put and call rights: exercise can trigger FC-TRS reporting and pricing questions on transfers involving non-residents.
• ESOP pool and reserved shares: determines dilution and needs a scheme resolution and compliant grant mechanics.
• Conditions precedent: demat completion, clean allotment history and regulatory approvals, each of which affects the closing timeline.

Marcken Consulting LLP reviews these provisions from a financial and regulatory standpoint and coordinates with the company’s legal counsel, who advise on the legal drafting.

10. ESOP Structuring for Companies Raising Equity

An ESOP pool is a standard requirement in institutional term sheets. Three points matter most. First, pool sizing and timing determine who bears the dilution, as the illustration above shows. Second, the exercise price is determined by the company under its scheme (Rule 12 of the Companies (Share Capital and Debentures) Rules, 2014), with a valuation at grant supporting pricing and accounting. Third, the fair market value of unlisted shares at exercise, used for perquisite tax (see our guide to taxes on ESOPs for startups in India), is determined by a Category I Merchant Banker under the income-tax provisions in force; this is a separate requirement from the Rule 21 FEMA certificate and is not satisfied by a CA-signed report. Grants to non-resident employees carry FEMA reporting implications on exercise. See ESOP Consultant in India for scheme design, valuation and tax compliance.

11. Sector Considerations

• Technology, SaaS and consumer startups: valuation rests on recurring revenue, retention and customer acquisition cost, benchmarked against listed peers; ESOPs and CCPS-based rounds are common.
• Manufacturing and exporters: working-capital intensity, currency exposure and customer concentration are examined closely by investors and by a FEMA reviewer; sectors with specific caps or conditions need an entry-route check.
• NBFCs, fintech and financial services: DCF models must reflect net interest income and regulatory capital; foreign investment carries sector-specific conditions and RBI regulatory implications. See our NBFC licence guides for the regulatory side.
• Promoter-led family businesses: the first institutional investor brings a formal valuation, a shareholders’ agreement and governance; related-party balances, cross-holdings and informal family share arrangements should be resolved before the term sheet.
• Real estate and infrastructure: asset-heavy balance sheets where NAV and DCF are both relevant, and where RERA obligations run alongside the equity round.

12. Where the City Guides Take Over

This pillar guide stops where the local detail begins. The national legal framework is the same everywhere, but the Registrar of Companies that receives your PAS-3, the RBI regional office, the SEBI office, the NCLT bench and the investor ecosystem differ by city. Each guide in the series takes the framework above and applies it to one hub, so the next step after this page is the guide for the city of your registered office:

• Equity Funding Consultant in Ahmedabad: Gujarat companies and ROC Ahmedabad filings.
• Equity Funding Consultant in Mumbai: Maharashtra companies and Mumbai’s financial-services investor base.
• Equity Funding Consultant in Bangalore: Karnataka’s technology and venture-backed startup ecosystem.
• Equity Funding Consultant in Delhi: Delhi NCR, including the February 2026 ROC restructuring for Delhi, Haryana and Noida.
• Equity Funding Consultant in Chennai: Tamil Nadu’s SaaS, manufacturing and financial-services companies.
• Equity Funding Consultant in Hyderabad: Telangana’s pharma, technology and growth companies.
• Equity Funding Consultant in Jaipur: Rajasthan’s export-led family businesses and iStart Rajasthan.
• Equity Funding Consultant in Kolkata: West Bengal, ROC Kolkata-I and Kolkata-II, and promoter-led trading houses.

Companies in other cities are served in the same way: valuation, ROC filings and FIRMS coordination are carried out digitally from Marcken Consulting LLP’s Ahmedabad office, with meetings arranged as the engagement requires.

13. Common Mistakes in Indian Equity Rounds

1. Treating the valuation as a closing item: the report must exist before the special resolution and, for a foreign round, before the investment date.
2. Using a stale Rule 21 certificate: the certificate must not be more than 90 days old on the date of investment.
3. Confusing the ESOP FMV with the FEMA certificate: the two are separate requirements with different eligible signatories.
4. Missing the filing deadlines: PAS-3 in 15 days, FC-GPR in 30 days, FC-TRS in 60 days, and allotment within 60 days of receiving funds.
5. Skipping the beneficial-ownership check: a fund with a land-border limited partner can change the entry route for the whole round.
6. Leaving demat and cap table clean-up until late: unreconciled historical allotments are a frequent cause of diligence delays.
7. Agreeing the ESOP pool without modelling dilution: a pre-money pool moves value from existing shareholders to the investor.
8. Choosing an instrument that is not equity under FEMA: the classification decides which regulatory regime applies.

14. How Marcken Consulting LLP Supports Equity Funding in India

Marcken Consulting LLP is the equity funding consultant in India for founders and promoters who need financial advisory and regulatory compliance for their equity round under one roof. The firm advises technology startups, manufacturers and exporters, NBFC and fintech companies, real estate businesses and promoter-led family groups:

• Financial modelling and investor-ready financials: sector-specific DCF models with documented assumptions, built for both investor due diligence and FEMA compliance.
• Cap table design and dilution modelling: pre- and post-round modelling across scenarios, ESOP pool sizing and convertible instrument structuring, mapped to FEMA and Companies Act consequences.
• Rule 21 fair value certification: signed directly by Marcken Consulting LLP as a practising Chartered Accountant firm, or arranged through an established panel SEBI-registered Merchant Banker where the investor’s term sheet requires it.
• IBBI Registered Valuer report: for domestic rounds under Companies Act Rule 13, signed in-house by CA Murli Chandak, IBBI-Registered Valuer for Securities or Financial Assets.
• FC-GPR filing support: preparation of all FIRMS portal documents and coordination with the AD bank within the 30-day deadline.
• Companies Act allotment compliance: PAS-3 preparation and filing, special resolution coordination, and demat and ISIN setup where required.
• ESOP FMV certification: valuation support at grant, and Merchant Banker FMV certification at exercise for perquisite tax, coordinated with the fundraising timeline.

The firm also supports companies with IPO readiness, statutory and transaction valuations, GST advisory and Virtual CFO services.

How an Engagement Works

1. Scoping call: we confirm your round structure, investor residency and the applicable valuation and filing sequence, in writing, before any documents are requested.
2. Document collection: audited financials, cap table, prior allotment records, and the term sheet or investment agreement.
3. Valuation: DCF, NAV or CCM as the regulatory framework requires, built to ICAI Valuation Standards.
4. Filing support: PAS-3 with the Registrar of Companies, FC-GPR on FIRMS through your AD bank, and EGM and board resolution drafting support.
5. Delivery: the signed report and a fixed-fee invoice, with no additions once the fee is confirmed at scoping.

Fees

Fees depend on the signatory required (a Merchant Banker-signed report carries a higher fee than a Registered Valuer or CA-signed one), the complexity of the entity (a single-entity company is more straightforward than a multi-entity group), and whether the round involves a foreign or NRI investor, which adds FEMA documentation to the engagement. Every fee is quoted in writing at the scoping stage, with no additions once agreed.

Quick Reference: What Does Your Equity Round Require?

Scenario	Valuation Required	Who Signs	FEMA Filing	Companies Act Filing
Domestic angel or VC round (all residents)	Yes, fair value for Rule 13	IBBI Registered Valuer	No	Special resolution + PAS-3 within 15 days
Foreign VC / PE round, or a foreign strategic investor	Yes, fair value for FEMA Rule 21	CA, SEBI-registered Merchant Banker or Cost Accountant	FC-GPR within 30 days of allotment	Special resolution + PAS-3 within 15 days
Capital infusion from a foreign parent	Yes, fair value for FEMA Rule 21	CA, SEBI-registered Merchant Banker or Cost Accountant	FC-GPR within 30 days of allotment	Board resolution + PAS-3 within 15 days
CCD / CCPS issuance to non-resident	Yes, at issuance only; conversion price or formula fixed upfront, not lower than fair value at issuance, and no fresh certificate at conversion	CA, SEBI-registered Merchant Banker or Cost Accountant	FC-GPR at issuance; report the conversion on the RBI FIRMS portal as required	Special resolution + PAS-3 at each allotment
ESOP grant (unlisted company)	Valuation at grant for pricing and accounting; Merchant Banker FMV at exercise for perquisite tax	SEBI Category I Merchant Banker	No (unless issued to non-resident employee)	ESOP scheme resolution; PAS-3 at exercise allotment
Secondary transfer involving a non-resident	Pricing per the current FEMA pricing rules	As required by the pricing rules	FC-TRS within 60 days	Share transfer formalities and register updates
Land-border investor (Press Note 2, 2026)	Yes, plus prior government approval if the land-border beneficial ownership exceeds 10% or carries control	CA, SEBI-registered Merchant Banker or Cost Accountant	Approval or reporting under the DPIIT procedure, then FC-GPR	Special resolution + PAS-3 within 15 days

Checklist: Is Your Company Ready for an Equity Round?

• Audited accounts for two to three years: signed, with the notes and related-party disclosures complete.
• Reconciled cap table: every past allotment and transfer supported by resolutions, PAS-3 and, for foreign rounds, FC-GPR or FC-TRS.
• Dematerialised shares: where Rule 9B applies, ISINs active and holdings dematerialised.
• Three-to-five year financial model: documented assumptions consistent with the audited base year.
• Valuation route identified: Registered Valuer report, Rule 21 certificate, or both, decided by investor residency.
• Beneficial-ownership check on investors: completed before the term sheet is signed.
• ESOP pool sized and modelled: dilution shown across scenarios.
• Statutory calendar ready: allotment in 60 days, PAS-3 in 15 days, FC-GPR in 30 days.

Frequently Asked Questions

1. What does an equity funding consultant in India actually do?

The consultant prepares the company for investors, determines the correct valuation and signatory for the round, designs the cap table and instruments, reviews the term sheet for regulatory consequences, and completes the Companies Act and FEMA filings. The aim is a round that is investable, correctly priced and legally valid, not merely an introduction to investors.

2. Do I need a valuation report for every equity round?

Yes. A domestic preferential allotment needs a Registered Valuer report under Rule 13 of the Companies (Share Capital and Debentures) Rules, 2014. An issue to any non-resident by an unlisted company needs a Rule 21 fair value certificate from a Chartered Accountant, a SEBI-registered Merchant Banker or a practising Cost Accountant, not more than 90 days old at the date of investment.

3. Can a Chartered Accountant certify the FEMA valuation, or is a Merchant Banker required?

Rule 21 names three professionals for an unlisted company’s fair value certificate: a Chartered Accountant, a SEBI-registered Merchant Banker and a practising Cost Accountant. Where the term sheet or the investor’s counsel specifies Merchant Banker certification, that becomes the requirement for your round. ESOP FMV certification at exercise is a separate requirement that does call for a Merchant Banker specifically.

4. What are the filing deadlines after an equity round?

Allotment must be made within 60 days of receiving the subscription money. Form PAS-3 is due with the Registrar of Companies within 15 days of allotment. For foreign investment, Form FC-GPR is due on the RBI FIRMS portal, through the AD bank, within 30 days of allotment. A secondary transfer involving a non-resident is reported on Form FC-TRS within 60 days.

5. Is angel tax still applicable to share premium?

No. Section 56(2)(viib) of the Income-tax Act, 1961 was abolished by the Finance (No. 2) Act, 2024 and does not apply from assessment year 2025-26; proceedings for earlier years continue under the old law. The Companies Act and FEMA valuation requirements described in this guide continue to apply.

6. How does Press Note 2 (2026) affect investors from countries sharing a land border?

The test is beneficial ownership and control rather than the investor’s jurisdiction alone. An investment in which land-border beneficial ownership exceeds the 10 per cent threshold, or which carries control rights, generally needs prior government approval, while other cases may proceed on the automatic route with reporting where the sector permits. For funds and layered structures, confirm the ultimate beneficial owner before signing the term sheet.

7. Can a consultant based in one city serve companies in another?

Yes. Valuation work, Companies Act filings and FC-GPR reporting through the AD bank are carried out digitally, and Marcken Consulting LLP serves companies across India from its Ahmedabad office. Each city guide in this series sets out the local Registrar, RBI, SEBI and NCLT offices relevant to that hub; start with the guide for the city of your registered office.

8. How do I get started?

A 15-minute scoping call is the fastest route: we confirm your round structure, investor residency and the correct valuation and filing sequence, then issue a fixed-fee proposal within one business day. Reach us at crm@marckenconsulting.com or on WhatsApp.

More Guides by City

IPO readiness guides: Mumbai, Ahmedabad, Bangalore, Delhi, Chennai, Hyderabad, Jaipur and Kolkata.

NBFC licence guides: Mumbai, Ahmedabad, Bangalore, Delhi, Chennai, Hyderabad, Jaipur and Kolkata.

Related Services and Guides

• Business Valuation in India: Complete Regulatory Guide: frameworks, methodologies and signatory rules
• ESOP Consultant in India: national scheme design, valuation and tax compliance guide
• SAFE and Convertible Note Valuation in India: valuation of early-stage convertible instruments
• Share Swap and Merger Exchange Ratio Valuation in India: valuation for mergers and share-swap transactions
• IPO Consultant in Ahmedabad: pre-IPO valuation and IPO readiness
• NBFC License Consultant in Mumbai: RBI registration for NBFC and fintech companies
• Equity Funding Consultant in Ahmedabad: the Gujarat edition
• Equity Funding Consultant in Mumbai: the Maharashtra edition
• Equity Funding Consultant in Bangalore: the Karnataka edition
• Equity Funding Consultant in Delhi: the Delhi NCR edition
• Equity Funding Consultant in Chennai: the Tamil Nadu edition
• Equity Funding Consultant in Hyderabad: the Telangana edition
• Equity Funding Consultant in Jaipur: the Rajasthan edition
• Equity Funding Consultant in Kolkata: the West Bengal edition

Official sources referred to in this guide: the RBI Master Direction on Foreign Investment in India, RBI’s FIRMS portal, the DPIIT Press Note 2 (2026 Series), the DPIIT Standard Operating Procedure dated 4 May 2026 (fifp.gov.in), the IBBI register of Registered Valuers, the SEBI office directory, the MCA Registrar of Companies contacts, the Startup India portal and the ICAI valuation standards.

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Speak to Us

Marcken Consulting LLP offers a no-charge 30-minute consultation to discuss your equity round, cap table structure, valuation requirement, or FEMA compliance position.

Marcken Consulting LLP | CA Murli Chandak, IBBI-Registered Valuer (Securities or Financial Assets)
Website: marckenconsulting.com
Phone: +91 99980 59923 / +91 99985 39902
Email: crm@marckenconsulting.com

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Regulatory positions in this guide are as published by the relevant Indian regulatory authorities as at September 2026 and are confirmed at the date of filing. This guide is general information, not investment, legal or regulatory advice. For legal advice specific to your transaction, engage a qualified legal professional.