|Company Name||Ex Date||Purpose||Record Date|
|SEPC Ltd||28 Nov 2023||Right Issue of Equity Shares||28 Nov 2023|
What is Right Issue?
A Right Issue is a type of offering of additional shares by a publicly-traded company to its existing shareholders in proportion to their existing holdings. It is a way for a company to raise capital by allowing current shareholders to purchase newly issued shares at a discounted price, giving them the “right” to buy the shares before they are offered to the public.
In a right issue, the company determines a subscription ratio that specifies the number of new shares that shareholders can buy for every share they already own. The subscription price for the new shares is usually lower than the market price, which makes it a more attractive offer for existing shareholders.
Right issues are often used by companies to raise funds for business expansion, to pay off debt, or to acquire other companies. They can also be a way for companies to reduce their debt-to-equity ratio by issuing new shares instead of taking on additional debt.
It’s worth noting that participation in a right issue is optional for existing shareholders, and those who choose not to participate may see their ownership stake in the company diluted.