PROMOTOR HOLDING
ANKIT KUMAR (60 Points)
22 December 2018what is affected....value of shares or no. of shares???
ANKIT KUMAR (60 Points)
22 December 2018
Sachin C
(Tax Consultant)
(107 Points)
Replied 22 December 2018
Hello Ankit,
If a promoter is looking for Diluting his stake in the Company he has two options one being that he shall transfer his shares by executing a Share Transfer Deed(in Form SH-4) and pay the relevant Stamp duty and the second one being the company buying Back his shares and then go for a share cancellation. Issuing of Bonus shares on the other hand is Capitalisation of profits. So if a promoter dilutes his stake through the first method then there is no change in the overall Value of Share capital nor the No. of Shares but onlyy the stake(in %) shall differ.
Thank You,
Sachin C
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