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Rights Issues

An offer of new securities to eligible existing shareholders.

NPSETFsRights IssuesSGB

Understand the product

What is Rights Issues?

A rights issue allows a company to raise capital by offering securities to eligible existing shareholders in a stated ratio and at a stated price. Participation is voluntary. A Rights Entitlement (RE) is not the same as the resulting share and can lapse if no permitted action is taken before its deadline.

Official-source first

The guide agent answers from the curated regulator and market-institution material shown on this page. It does not promise returns or replace the applicable offer document, scheme rules or professional advice.

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How it works

  1. 1The company announces terms, record date, issue period, ratio, price and a Letter of Offer.
  2. 2Eligible holders receive Rights Entitlements based on holdings on the record date.
  3. 3An investor may apply, renounce/sell eligible REs during the permitted window, or take no action.
  4. 4Applications and blocked funds are processed under the issue terms; allotted securities are later credited to demat.

How to start with Rights Issues

  1. 1Verify eligibility, record date, issue dates and the exact RE quantity in the demat account.
  2. 2Read the Letter of Offer—especially objects of issue, risk factors, financials, price, payment schedule and deadlines.
  3. 3Choose whether to subscribe, apply for additional securities where allowed, renounce/sell REs, or let them lapse.
  4. 4Apply using the permitted ASBA or issuer/exchange process before the closing deadline and retain acknowledgement.

Regulated ecosystem

Who offers or supports it?

Issuer company

Makes the rights offer

SEBI

Regulatory framework and investor education

NSE and BSE

Offer documents and RE trading where applicable

Registrar to the issue

Applications, entitlement and allotment support

SCSBs / brokers

Permitted application or transaction channels

Before you act

Important checks

  • !REs can expire worthless if neither used nor renounced within the permitted period.
  • !The price paid to buy an RE is separate from the subscription amount payable for the rights security.
  • !A discounted offer price does not guarantee profit; read why the company is raising money.
  • !Non-participation may dilute percentage ownership, although the economic effect depends on the full transaction.

Official-guide agent

Ask about Rights Issues

Fast educational answers grounded in this guide. It will not select a product for you or provide personalised investment advice.

Ask me anything about Rights Issues—how it works, registration, providers, risks or official verification.

Educational information only. Rules, taxation, eligibility and product availability can change. Verify the latest regulator, issuer and intermediary documents before making a financial decision.