Thanks for updating. Can you please explain the rights issue process for pledged shares( The process is not explained anywhere). Will client get email regarding RE or do we have to call customer care to enable it ?
Normally, should I expect the stock to increase or decrease in the short range due to rights issue? Or no effect at all?
The shares will be listed soon after the rights issue closes. Since these are party paid up shares, the shares will be listed separately (like tatasteel-pp (BSE) or tatasteel-E1 (NSE) shares which trade separately from the fully paid ordinary shares).
You can sell the REs once they are listed on the exchanges like you normally sell shares from your holdings. Although the date for RE listing is not out yet, it should be same as the issue opening date - May 20th.
Although you’re not eligible to be allotted the shares, the RTA will still mark you as eligible for 1 share. You may or may not be allotted the shares, depending upon the overall subscription.
You don’t have to call/raise a ticket to give an instruction to Zerodha to this effect. The REs will be credited to your demat account by issue open date - May 20th.
Please check this:
In the Partly paid up shares or fractional shares :::: how dividends are paid/received ? Or how the other corporate actions are adjusted ?
Assume Reliance has announced a dividend of 400%. This means you will receive 400% of the paid up value of your shares as dividend. If you hold the ordinary shares of paid up value Rs. 10 then you receive Rs. 40 as dividend. Similarly, if you hold the partly paid up shares of Rs. 2.50, you receive Rs. 10 as dividend.
Today got an email from CDSL.
5 units Credit of RELIANCE INDUSTRIES LTD#RIGHTS ENTITLEMENTS FOR PARTLY PAID-UP EQ OF FV RS.10/- & PAID-UP RS.2.50/-
Can someone explain what is this? Also what should be done next?
I also received a similar email. Not sure what needs to be done
I also received the same mail. Can somebody explain its meaning?
Can I Apply if I have less than 15 share ?
As you are aware Reliance industries have initiated rights issue and they have credited some rights entitlement to my demat account A held by me with say ICICI because my existing shares of reliance are in this demat account. I don’t do much trading as such so this is acct A not linked with any broker.
Now supposed I also have a trading and demat account B with Zerodha then in order to sell them thru Zerodha can I first do an off-market transfer using delivery instruction slip from my own ICICI Bank Demat Account A to my own Zerodha demat account B?
Is such a transfer of rights issue from my own account A to my own account B allowed?
The challenge is lockdown. If I sell thru a broker and then fail to reach ICICI bank for any reasons like police not allowing, the bank closed due to sudden changes in lockdown guidelines or any such events, within T+1 to submit DIS then I will be in trouble.
And suppose such a transfer is allowed and after I bring them in my Zerodha demat and if I do not take any action until June 3rd then how Reliance will know that now they need to be withdrawn from my Zerodha demat rather than earlier ICICI bank demat?
Any clarity will be great.
Thanks in advance. Take care and stay safe.
@mohitmehra Can you.
You can transfer the rights entitlements from one demat account to another via an off-market transfer. If you don’t take any action, and let the REs remain in your Zerodha account, they will lapse after the issue closes.
Can’t see RE in Zerodha holdings.
What if someone sells his REs and then applies for right issue? What is the cross check on their end?
The RTA will collect your demat account details and then check for the REs before allotment.
I have another query… Excuse me for my lack of knowledge but I request for help. Let’s say I have received 100 Rights entitlement in my Demat and I plan to sell it off. Then I believe they will get sold at the price fixed by Reliance i.e. I guess 1257.
So a buyer will buy them on stock exchanges at 1257. However when the settlement will happen for this trade, I believe I will get the sum = 100*nil price. Which I believe is around approx 173 per share or so. That’s where I recover the cost of proposed dilution and Reliance gets the rest of the funds from those 100 share sell.
Kindly confirm if I am correct.
I used https://www.trignosource.com/finance/Nil-paid%20rights.html to check the nil paid value.
Today closing price 1442. Rights price 1257 and number of rights I believe should be 1/15 = 0.066667.
Thanks and regards.