Rights Issue of Shares | Explained in Hindi with Examples

In a rights issue, existing shareholders are given the opportunity to buy a set number of new shares in the company they own. These new shares are often available at a discount to the existing share price, to encourage investors to take part.

In this video, you will learn what is rights issue in Hindi and how one can avail rights issues. Watch the video till the end!

The rights issue is similar to IPOs, there is a start and end date just like IPO, the existing shareholders receive the rights entitlements (number of shares in the ratio of their existing shares). These are the only minimum guaranteed shares that the shareholders will get if they choose to apply for the rights issue.

If a shareholder applies for the additional shares in the rights issue, the additional allotment of shares will be subject to the subscription (how many shareholders applied and how many didn't).




Wockhardt, A Mumbai-based pharmaceutical company is going to launch rights issues from 15 March to 22 March 2022, Their rights issue value is worth ₹748 Crore. The current market price of shares is ₹293 but in the rights issue, the existing shareholders can get the shares at a discount price of ₹225

The rights entitlement ratio of Wockhardt is 3 : 10, i.e, for every 10 shares that a shareholder has, they will get a minimum of 3 or more at a discounted price, of course.

Listen to the Complete video to get brief information about What the Rights issue of Shares is!

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Chapters
0:00 What is the Rights issue of shares
1:04 Detailed info
1:54 Example
2:32 Why A Company Brings Rights Issue
3:14 Wockhardt
4:04 Rights Entitlement Ratio
5:27 Advantages of rights issue
6:42 Disadvantage of Rights Issue.

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