What is a Rights Issue? What are Rights Entitlement shares?
A rights issue is an offering of rights to the existing shareholders of a company that allows them to buy additional shares directly from the company at a discounted price rather than buying them on the secondary market. That is, if you own a share, you get the “right” to buy more shares – in a certain ratio, at a certain price. For example, a 5:21 issue means you get the right to buy FIVE share for every TWENTY-ONE shares you own.
Rights Entitlement Shares: This is relatively new concept in the Indian stock market, where the entitlement itself is traded on the exchange. Owning RE shares is not the same as owning rights shares. A shareholder needs to apply for rights shares based on entitlements received separately. RE is a temporary credit of shares in the Demat account, which allows the rights holders to buy fresh shares of the same company and for those who are not interested in adding more shares of the same company – to sell their RE shares in a trading window on exchanges to other willing investors for a price.
What is the issue size of the Suzlon Energy Rights issue?
The issue size of Suzlon Energy Rights Issue is of 240 crore equity shares at ₹5 per share aggregating upto ₹1,200Crores.
What is the ratio of Suzlon Energy Rights issue?
The issue will be in the ratio of 5:21 (i.e. 5 rights equity shares for every 21 fully paid-up equity shares held by eligible shareholders).
What are the important dates that I need to remember as an Investor?
Here’s a list of few important dates for Suzlon Energy Rights Issue
Record Date | 04th Oct 2022 |
Rights Entitlements Credit date | 10th Oct 2022 |
Rights Entitlements Renunciation date | 14th Oct 2022 |
Issue Opening date | 11th Oct 2022 |
Issue Closing date | 20th Oct 2022 |
Date of Allotment (estimate) | 31st Oct 2022 |
Date of Credit (estimate) | 1st Nov 2022 |
Date of Listing (estimate) | 3rd Nov 2022 |
Record Date: Record date is the day for determining the shareholders to whom the rights entitlement shares will be alloted(i.e. Shareholders as of 4th Oct 2022).
Rights Entitlements Credit date: RE shares are credit to your demat account by this date.
Rights Entitlements Renunciation date: Shareholders who are not willing to accept the rights offer can renounce their RE shares by this date. NOTE: Any Rights Entitlement which is neither renounced NOR applied for rights issues shall lapse.
Issue opening and closing date: This is the trading period for RE shares
How to deal with the credited Rights Entitlement shares?
1. Shareholders may renounce the Rights Entitlements shares credited to their respective Demat accounts. Alternatively, shareholders can trade/sell them from their Demat Holding by 20th Oct 2022. Once sold, the money will be credited within T+2 days of such sale of shares.
2. Apply for Rights issues by making an application
How to apply for Rights Issue shares?
We'll walk you through the steps for applying for the Rights Issue of Suzlon Energy Limited.
Step 1: The Application Form for the Rights Issue Shares would be sent to the Eligible shareholders at the valid e-mail ID. Alternatively, investors can download the same from the website of the Registrar (Registrar for Suzlon Energy Limited: KFin Technologies Limited)
To download the application form for Suzlon Energy Limited Click Here
Step 2: Shareholders must fill this application form with the required details.
Step 3: Submit the filled Application Form to the Designated Bank branches on or before 20th Oct 2022. Click here to refer to the list of Bank Branches where this application can be submitted.
Steps to apply for Suzlon Energy Rights Issue 2022 using Net Banking (ASBA)
Log in to the net banking account of your bank.
1. Go to the 'IPO & Rights Issue' section.
2. Check if the Suzlon Energy Rights Issue 2022 available on the list.
3. Click the Apply button next to the Suzlon Energy Rights Issue 2022.
4. Fill and check your information. Submit the application.
Note: Your bank may not offer this facility to certain rights issues.
Frequently Asked Questions (FAQs):
1. How do I obtain the details of my Right Entitlement?
One can obtain the details of their respective Rights Entitlements from the website of the Registrar
by entering either their
- DP ID and Client ID or
- Folio Number (in case of resident Eligible Equity Shareholders holding Equity Shares in physical form) and PAN.
2. How does ASBA work in Rights Issues?
In the case of ASBA facility, the investor agrees to block the entire amount payable on the Application with the submission of the Application Form at designated branches of SCSB (Self-Certified Syndicate Banks) by authorizing the Bank to block an amount in the Investor’s Account.
3. How do I get the list of designated branches of SCSBs for submitting the application form for Rights Issue?
The list of banks that have been notified by SEBI to act as SCSB for the ASBA process is provided on
https://www.sebi.gov.in/sebiweb/other/OtherAction.do?doRecognisedFpi=yes&intmId=34
4. Can a investor make multiple Applications for Rights Issues?
Only one single Application Form shall be used by the Investors to make Applications for all Rights Entitlements available in a particular Demat account.
In the case of multiple Demat accounts, the Investors are required to submit a separate application form for each Demat account.
Disclaimer: ICICI Securities Ltd. (I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai - 400 025, India, Tel No : 022 - 6807 7100. I-Sec is a Member of National Stock Exchange of India Ltd (Member Code :07730), BSE Ltd (Member Code :103) and Member of Multi Commodity Exchange of India Ltd. (Member Code: 56250) and having SEBI registration no. INZ000183631. Name of the Compliance officer (broking): Ms. Mamta Shetty, Contact number: 022-40701022, E-mail address: complianceofficer@icicisecurities.com. Investments in securities markets are subject to market risks, read all the related documents carefully before investing. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The securities quoted are exemplary and are not recommendatory. The contents herein above are solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. Investors should consult their financial advisers whether the product is suitable for them before taking any decision. The contents herein mentioned are solely for informational and educational purpose.
