Rights Issue
A rights issue, also known as a rights offering, is a way for a company to raise capital from its existing shareholders. Here's a breakdown of the key aspects:
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What is a Rights Issue?
Rights Issue is an invitation to the existing shareholders to offer more shares of the company at a discounted price. This type of issue gives existing shareholders securities called rights. The company is giving a chance to the shareholders to increase their shares.
Process of Issuing Rights
Step 1: Share requirements + documents
Step 2: Pass the board resolution
A resolution would be passed to brief out about details
Step 3: Sharing documents
The Wazzeer team shall prepare draft documents and share them with you for your signature.
Step 4: Clients to share executed documents
Clients need to send us back their signed documents.
Step 5: Clients to share bank statement
Clients would have to share their bank statements with us, which show the money received from the investors.
Step 6: Filing of e-form with the ministry
Our professionals will file the required e-forms with the Ministry of Corporate Affairs.
Step 7: Issue share certificate
Our team will issue share certificates to the shareholders.
Step 8: Sharing deliverables
We will share the resolution and other relevant documents relating to allotment of security, Filed e-forms and challans, and Share Certificates.
Documents Required for Rights Issue
- PAN copy of allottees
- Bank Statement (After receipt of the investment amount
Key Deliverables
- Resolution and other relevant documents relating to the allotment of security
- Filed e-Forms and Challans
- Share Certificates
Why choose Wazzeer?
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One platform for all your requirements
Incorporation is just the first step. Wazzeer supports you throughout your journey as an entrepreneur. Log in to get things done efficiently. A dedicated Account Manager offers the required human touch and acts as an advisor to you.
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Experienced professionals
Our professionals have at least 5 years of experience and have incorporated thousands of companies among them. The rich experience ensures that the process is smooth and right in the first go.
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Defined process
Over the last few years, doing over 500 incorporations, we have defined every step of the process. A virtual process is in place enabling us to deliver hassle free experience for you.
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Cost Effective
You pay what you see in the proposal. No surprises or hidden charges.
Frequently Asked Questions
What is the stamp duty that needs to be paid to issue Share Certificates?
Stamp duty for Share Certificates varies from state to state. However, in majority of the states, the stamp duty is 1% of the investment amount.
Who issues the Share Certificate to the investors or new shareholders?
Share Certificates are issued to the shareholders by the company after paying the requisite stamp duty. In case the paid-up capital of the company is less than Rs 50 lakhs, it is signed by the Directors of the company and for the cases where the paid-up capital is more than Rs 50 lakhs, a Company Secretary (on the payroll of the company) needs to sign it
Do we need a separate bank account for the investment coming in?
In case the company is using the private placement of shares method to raise capital, a separate bank account should be used to receive the investment. In case the company issues shares via Rights issue, the investment can come to the company’s primary bank account.
What is the difference between offering shares to the investors by Rights issue or private placement of shares and share transfer?
Share transfer is the transfer of share from an existing shareholder to the investor. The money, in this case, goes to the shareholders selling their shares. They will need to pay the applicable income tax. In the case of Rights issue or Private placement of shares, fresh shares are issued by the company in lieu of the investment amount.