Queries on "rights issue"

[meetvetri]

I came to know that Religare is coming up with a rights issue shortly to raise money of Rs 1850 crores. As I own few Religare shares, I have few question on how to participate in it.


1. How to apply? Is it through portals like ICICIDirect or the company would send paper application?

2. If not interested to exercise the option as a shareholder, how to "sell the rights option" in the market?

Thanks
Meetvetri

 

[sagarkapoor]

I'll try to answer your questions but seniors please correct me if I'm wrong:

1. The Rights Issue can only be exercised by applying directly to the company. Generally, they'll send you a form stating the number of shares you own and the number of RIGHT shares you can apply for.
2. Its simple sell your shares and you automatically give up the right to own the RIGHT shares. Hope you understand that a Rights issues gives extra privileges to you as a Stock owner you cannot sell a right to someone without selling your shares to them. So simply put it you sell your shares to allow someone else to have the right to buy the RIGHTS issue shares There is no other way that I know of in which you can sell just the right to someone to buy those RIGHTS issue shares.

Hope that helps

 

[rvm123]

in the rights share application itself, there will be a portion for renouncing the rights shares. if some one is interested in buying the same, u can renounce the same in his favour and collect the premium money. but u should get a buyer. u can get a buyer through yr broker, if u are trading thro any broker