Rights issue How it works? How to apply for rights issue? How it will be helpful for investor? How does share price reacts during rights issue?

General
1

a) Rights issue how it works? Why companies prefer to raise funds through rights issue? How to apply for rights issue?

b) How it will be helpful for investor?

c) How does share price reacts during the time of rights issue?

d) Company will announce the rights issue in the ratio of 2:10 which means every 10 shares he will receive 2 shares according to rights issue price. What happens if I hold less than 10 stocks?

e) If I don’t apply for rights issue will I incur any loss?

2

Hi Vinay,

Have a look here! Might give some idea to you

http://tradingqna.com/6534/abridged-letter-of-offer-neuland-lab-shares

3

suppose e.g. if : there is right issue of : 1 right entitlement for every 10 shares held . AND i possess 6 shares in demat account one and 4 shares in demat account two . Then how will i get the RE ?

4

Recently, Orient Green Power Company Ltd. has announced a 19:62 Rights Issue of Equity Shares!
Is it worth considering the long-term growth and future potential of this renewable energy stock?