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What is the benifit from rights issue?

Swapnil (Student) (183 Points)

07 March 2014

Sir plz clarify me that is there any dividend issued for shareholders having rights shares? If not then why to prefer rights shares.

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CA PANKAJ (business consultant) (288 Points)
Replied 07 March 2014

In my opinion yes right issued shares are equivalent to normal shares and dividends are also distributed to them.... Only preference is that they r issued at lesser price than actually what is the market price. Please correct me if I am wrong.

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CA Saroj Kumar (Keen to learn something new every moments) (2588 Points)
Replied 08 March 2014

hello dears..

As i know that the right share issed to the employees of the companies for sake of long retention of employees and intrenal companies policies. They offer to the employees at lower price then that of in open market prices. The right share are euivilent right as of normal share purchased from market. Hence its is prety much clear that they also have dividend right. If there will not any didvidend right theyn no one will purchase irrespective of lower price bcs there may not any income accrue to them in future.

I think u may got clarified.