Rights issue at premium

[aryan.]

Just when I thought I learnt how to divide stock prices when it comes to split and bonus, comes along this new thing called premium.

Rights issue of equity shares of Rs. 2/- each in the ratio of 1:3 @ premium of Rs. 30/-.

What does the above statement mean, specially the premium part.

 

[rajeabc]

Just when I thought I learnt how to divide stock prices when it comes to split and bonus, comes along this new thing called premium.

Rights issue of equity shares of Rs. 2/- each in the ratio of 1:3 @ premium of Rs. 30/-.

What does the above statement mean, specially the premium part.

Face Value : 2
Stock price : CMP ( you have not given here)(Expect it to be more than premium)
Premium : 30 price of Right issue

so if you have 3 stocks at the record date theb you will get 1 stock at 30 Rs. Normally Right issues are at discount rate except few exceptional(SUZLON) .

 

[aryan.]

Hi rajeabc, can you please tell me how to split GULFOILCOR in amibroker.


Rigths issue 27 Jul 2010 Rights issue of equity shares of Rs. 2/- each in the ratio of 1:3 @ premium of Rs. 30/-.

Close on 26/ Jul - 115.95
Close in 27/ Jul - 97.1

I cannot figure out what ratio should I enter in amibroker to split the price

 

[rajeabc]

Hi rajeabc, can you please tell me how to split GULFOILCOR in amibroker.


Rigths issue 27 Jul 2010 Rights issue of equity shares of Rs. 2/- each in the ratio of 1:3 @ premium of Rs. 30/-.

Close on 26/ Jul - 115.95
Close in 27/ Jul - 97.1

I cannot figure out what ratio should I enter in amibroker to split the price

aryan , you don't need to adjust Right issue in Ami as RIGHT issue are not free and not compulsory for every investors to buy .I doubt if any one would have bought this because premium was more than CMP. May be company sold Right Issues to institutions .

 

[aryan.]

Oh, learnt something new today, thanks rajeabc

There is quite a big gap between the closing prices of 26 and 27 so I thought I have to do a split in Amibroker.

 

[rajeabc]

Oh, learnt something new today, thanks rajeabc

There is quite a big gap between the closing prices of 26 and 27 so I thought I have to do a split in Amibroker.

Aryan , Sorry I think I am wrong in what I told you. Will wait for some senior to answer this Qs.

 

[aryan.]

Aryan , Sorry I think I am wrong in what I told you. Will wait for some senior to answer this Qs.

Ohh k, no problem

The weird part is Amibroker auto split cannot find the date when this split with premium occurred.

For me Ami auto split always finds the date when a split occurs automatically without fail.