Due diligence is an investigative process conducted before significant business transactions. It evaluates financial health, legal compliance, operational efficiency, and potential risks associated with a company.

• Financial Due Diligence: Assessment of the company’s financial statements, tax records, and asset valuations.
• Legal Due Diligence: Examination of contracts, licenses, regulatory compliance, and litigation risks.
• Operational Due Diligence: Review of business processes, supply chains, and organizational structure.
• Environmental Due Diligence: Evaluation of environmental compliance and liabilities.

• Companies Act, 2013 mandates disclosures during certain transactions.
• SEBI regulations govern due diligence for listed companies.
• RBI and FEMA guidelines apply to cross-border transactions.

• Minimizes risks by identifying hidden liabilities.
• Ensures compliance with legal and regulatory requirements.
• Provides a detailed understanding of the target company’s operations and finances.

• Review financial statements, tax filings, and compliance records.
• Verify legal contracts, licenses, and intellectual property documents.
• Conduct site visits to assess operations and processes.
• Interview key stakeholders for insights into the company’s operations.

• Step 1: Define the scope and objectives of the due diligence process.
• Step 2: Gather and review relevant documents from the target company.
• Step 3: Conduct field visits and interviews with management and key personnel.
• Step 4: Analyze findings and prepare a comprehensive due diligence report.

• Limited access to accurate data.
• Resistance from the target company’s management.
• Complex regulatory and compliance landscapes.
• Unforeseen risks uncovered during the process.

• Financial statements and tax returns.
• Legal contracts, licenses, and regulatory filings.
• Operational reports and organizational charts.
• Environmental compliance reports, if applicable.

• Submit the due diligence report to relevant stakeholders.
• File mandatory disclosures with regulatory authorities, if required.
• Maintain detailed records of findings for future audits or references.

• Professional Fees: Varies based on scope and complexity of the due diligence process.
• Regulatory Filing Fees: If applicable, based on the type of transaction.
• Estimated Total Cost: Rs. 50,000 to Rs. 5,00,000, depending on the scale of the project.