Everything you need to know about the M&M Financial rights issue

Mahindra Financial will issue Right Entitlements (REs) to anyone who holds its shares as on July 23, 2020 (record date). The settlement of a stock takes two trading days in India which means you’ll have the shares in your demat account on the record date if you’ve purchased it on July 21st. After July 21st, the shares will trade ex-rights i.e. without the rights entitlement benefit. The ex-date was July 22nd.

If you sold your shares on the ex-date you’ll still be entitled for the rights but the REs will first be credited to your stockbroker’s account who will then send it to your demat account.

These REs will be temporarily traded on the stock exchanges and will then be extinguished. You can either use the REs to apply for the rights shares of Mahindra Financial or you can sell them directly.

You can check the announcement from the company here .

Issue details
Ratio 1:1
Issue Price ₹ 50
Issue Period July 28, 2020 to August 11, 2020
RE Trading Period July 28, 2020 to August 7, 2020
Listing date August 27

How to apply for the Mahindra Financial rights issue?

Once you either receive the REs from the company or purchase it from the market, you will need to apply for the rights shares using Netbanking ASBA. You can check the process in this post . You can verify your entitlement on the website of the Registrar & Transfer Agent . The website will not be completely live until the issue opens.

You will need to enter your demat account’s Beneficiary Owner ID which is a 16-digit number while applying either on the RTA’s website or through your bank.

Toll-free number of the Registrar to the Issue: 18004258998 / 18003454001

4 Likes

Hi, M&M announced its rights issue so i want to buy shares tomorrow, n sell after the next day of record date still I’m eligible to get the shares of rights issue or should i have to hold the shares until rights issue completed.

Record date for determining eligible shareholders is 23 July, if you hold shares on this date you will be eligible to receive RE’s, even if you sell shares later.

Keep in mind though RE’s aren’t rights shares, you will have to use RE’s to apply for rights shares.

Thanks boss, if i buy tomorrow n sell 24th still get RE right, after i can use this to buy rights issue shares or can sell RE right?

Thanks in advance again

Right.

2 Likes

Will the Rights Entitlement be traded in the same way as for reliance and Arvind fashions.Can I buy RE from secondary market and then apply for Right issue

Yes, but i think that will be traded @premium

Are you sure @siva can you clarify

Yes, the issue will be same as Reliance, Arvind Fashion, ABFRL etc.

Hi guys will you’ll be doing a quick 1 pager on the M&M Fin rights issue?
And a question around the number of shares. M&M Fin already has 61 crore shares and they are adding an additional 61 crores shares. can someone help with calculating the potential share price post listing. Please see if I have the right math done below.

61 crore share * 207 mp = 12,000 crore market cap.
rights issue of 61 crore shares * 50 = 3000 crore approx.

therefore total 15,000 crore / 122 crore = approx. Rs. 120 per share ?
is the above logic right?
thanks
br,
Andy

ShubhS9 Thanks for reply, sorry one more question is there any possibilities that share price may correct on Record date i.e 23 July, Like others shares correction on Dividend Record date,
pls let me know i bought the M&M Fin Shares today n will on 24 july, hope i’ll get Rights Issue

Rights Issue is completely different than Dividends, so the price might not correct.

Thanks Bro, for all.

so i bought today n planning to sell on 24 July, When will i get RE in my account

Issue is set to open on 28th July, so you should have RE’s in your account before that.

1 Like

what if stock is pledged

Thanks Bro, ur Great Gem

The broker will receive the REs in their demat account and subsequently be able to make an off-market transfer to the respective client accounts. So, the client will receive the REs even if they don’t unpledge their holdings

@ShubhS9 im planning to hold the share for short term with SL of 180 Bcoz it gave breakout on daily TF so let’s see how it goes, I think i bought it on high price, let’s hope for the best:crossed_fingers:

hi -

  1. If i buy on 21st, I will have the shares in my demat by 23rd right(T+2 settlement) ? So I will be eligible for rights issue?
  2. And I can sell those shares on 24th and still be eligible for rights?

You should be eligible.