How to Apply for Rights Issues

dewminigamlath · 1 How to Apply for Rights Issues Tue Aug 02, 2011 10:27 am

dewminigamlath

Manager - Equity Analytics

Posts : 126
Equity Stars : 4916
Reputation : 18
Join date : 2011-06-12
Age : 36
Location : Yakkala

Can someone please explain the procedure for applying for rights issues...?
-where to apply
-how and when to pay
-when the shares are allocated

dewminigamlath · 2 Re: How to Apply for Rights Issues Tue Aug 02, 2011 10:37 am

dewminigamlath

Manager - Equity Analytics

Posts : 126
Equity Stars : 4916
Reputation : 18
Join date : 2011-06-12
Age : 36
Location : Yakkala

Further, I want to know whether anyone not holding a company's shares can apply for a rights issue...?
If so, what is the meaning of XR date (like XD date in dividend payments)...?

windi5 · 3 Re: How to Apply for Rights Issues Tue Aug 02, 2011 4:22 pm

windi5

Moderator

Posts : 1549
Equity Stars : 7877
Reputation : 157
Join date : 2011-05-21

Just consult your lovely broker,if he not busy he will tell something. Very Happy

dinusl · 4 Re: How to Apply for Rights Issues Tue Aug 02, 2011 4:26 pm

dinusl

Co-Admin

Posts : 171
Equity Stars : 5081
Reputation : 12
Join date : 2011-01-21

Once company announce for their rights issue that company will sent you an mail with the application is attached to rights issue so you can do it that way...If you submit that application to your broker he'll take care of the other things you can pay by deduct money from CDS account .

If your non share holder but still want to buy rights then you should have to wait until that company rights will list on the market like example NHL.R0000 (Any symbol starts with R after the dot will be rights) When it's converting you have to pay.

Gaja · 5 Re: How to Apply for Rights Issues Tue Aug 02, 2011 4:28 pm

Gaja

Associate Director - Equity Analytics

Posts : 3127
Equity Stars : 9685
Reputation : 260
Join date : 2011-01-27
Age : 40
Location : Colombo

dewminigamlath wrote:Further, I want to know whether anyone not holding a company's shares can apply for a rights issue...?
If so, what is the meaning of XR date (like XD date in dividend payments)...?

You can't apply if you don't have the shares, if you have u can apply for additional shares, if you bought on XD you are not entitled to rights

dewminigamlath · 6 Re: How to Apply for Rights Issues Thu Aug 18, 2011 2:35 pm

dewminigamlath

Manager - Equity Analytics

Posts : 126
Equity Stars : 4916
Reputation : 18
Join date : 2011-06-12
Age : 36
Location : Yakkala

This is about CRL rights issue. One of my friends has bought 1000 @ 1.70 without knowing that it expires today. Since he could not sell them today, will he have to pay for them @ Rs.50 or can he just dispose the rights without converting (bearing the loss)...?

rijayasooriya · 7 Re: How to Apply for Rights Issues Thu Aug 18, 2011 2:52 pm

rijayasooriya

Senior Vice President - Equity Analytics

Posts : 1827
Equity Stars : 6815
Reputation : 134
Join date : 2011-05-25
Location : Matara

dewminigamlath wrote:This is about CRL rights issue. One of my friends has bought 1000 @ 1.70 without knowing that it expires today. Since he could not sell them today, will he have to pay for them @ Rs.50 or can he just dispose the rights without converting (bearing the loss)...?

Of course he can.If he is willing to bear loss just forget about it but remember the lesson.

dewminigamlath · 8 Re: How to Apply for Rights Issues Thu Aug 18, 2011 4:34 pm

dewminigamlath

Manager - Equity Analytics

Posts : 126
Equity Stars : 4916
Reputation : 18
Join date : 2011-06-12
Age : 36
Location : Yakkala

Thanks rijayasooriya.

Related to my last post;

If he decides to convert the rights into normal shares, he has to pay @ Rs.50. But, after that, will CRL price drop further or just stay on current level (since it already fell after the announcement of rights issue)...?

rijayasooriya · 9 Re: How to Apply for Rights Issues Thu Aug 18, 2011 4:52 pm

rijayasooriya

Senior Vice President - Equity Analytics

Posts : 1827
Equity Stars : 6815
Reputation : 134
Join date : 2011-05-25
Location : Matara

dewminigamlath wrote:Thanks rijayasooriya.

Related to my last post;

If he decides to convert the rights into normal shares, he has to pay @ Rs.50. But, after that, will CRL price drop further or just stay on current level (since it already fell after the announcement of rights issue)...?

That depends brother.After right issue usually there is a selling pressure.So price may go down or become stagnant.But it can go up also.I am not familiar with CRL.