What's with L&T Finance? L&T Finance Holdings Limited: Rights Issue

[mapes21]

@stricky How do I do it and what's the benefit if I do and if I don't?

 

[stricky]

@mapes21 These right entitlements are credited to your demat account and you can sell them like regular shares through your trading account.

As a shareholder you have the 'Right' to subscribe for additional shares at a price which is lower than what it would have been offered to general public.

-Subscribing to these shares means you are increasing your holding in the company at a price which is comparatively lower than the market price.

OR

-By selling the 'Right' you can pocket the money, which would just mean that you are reducing the cost of acquisition for the shares that you are currently holding.

Doing neither of these things will amount to renouncement and you wouldn't get any benefit.

 

[mapes21]

@stricky Got it. This was surely very helpful Thanks.

 

[matchfox]

@mapes21 If you don't understand a lot about investments, it's best to leave investing in individual stocks. Best to go for index funds. My two cents.

 

[mapes21]

@matchfox Thanks

 

[leigh17]

@mapes21 I can't fathom how SEBI allows this. With the advent of discount brokers, retail investments have shot through the roof. 99% of them don't understand the intricacies of corporate actions/ financials. And despite this SEBI allows promoters to raise capital via rights issue at a significant discount to market price. I mean this is the easiest way for promoters to raise their shareholding without putting up the money.