What is Rights Issue & Rights Entitlement? How to Apply & Sell Rights Issue Shares?

A rights issue is a corporate action where an offer is made by a company to its existing shareholders to buy new shares in the company. The number of new shares offered is usually proportional to the number of existing shares held by the shareholder. The price at which the new shares can be purchased is usually at a discount to the current market price of the shares.
In order to apply for these rights issues, shareholders need to have Rights entitlement. By Rights entitlement we mean a temporary demat security that represents the shareholder's eligibility to apply for the rights issue. Rights entitlements are offered to shareholders as a ratio to the number of securities held on the record date.
In this video, we discuss in detail the process to apply and sell rights issue in Hindi.
Time Stamps
00:00 Introduction
00:50 What is the Rights Issue?
01:27 What is a Record Date?
02:32 Why does the company issue rights?
03:30 What is Rights Entitlement?
04:58 How to apply for a Rights Issue?
05:53 Who is eligible for the Rights Issue?
06:36 Why to sell Rights Entitlement?
06:53 Advantages of selling Rights Entitlements
08:32 Should you apply for RE or sell RE?
09:16 How to sell Rights Entitlements?
09:50 Taxability on selling RE
10:56 How is portfolio value impacted?
13:15 Other important dates
13:50 Conclusion
Links to Refer
Learn more about the stock market here: zerodha.com/varsity/modules/
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[@NiVi432]

Love how crisp and clear the infp is. Bang on, to the point! Thanks a lot Zerodha for the series

[@sureshgs740]

Crisp presentation Ma'am. Thank you.

[@harjeetkhurana964]

Nice piece of information nicely explained… Excellent presentation..

[@Shorts4Urs]

Excellent explanations. Thanks

[@amoln5497]

Very well explained, thanks 🙏🏻

[@GudduYadav-hz6gy]

Thank you so much madam hindi me hi video banaye apke channel ki video bahut hi knowledgeable hoti hai

[@AjaySingh-hr8yq]

Well explained!!! thank you

[@akashsi]

Was so much confused after indiabulls housing rights issue. This video explained everything 🎉

[@ajaychouhdhary4437]

Same

[@OPTIONandSWINGTRADER]

So tell me if makes sense to sell or buy the India bulls rights I'm still confused 😄 currently the markets price of the rights are 45 Rs.

[@ujwalthakare1129]

same here. which value should be greater than entitlement @@OPTIONandSWINGTRADER

[@TylerDurdenVibes]

you are not alone :P though I am still wondering if I should buy or sell

[@TylerDurdenVibes]

here listing price > RE

[@osmreview]

Lots of respect for Mam plzz zerodha keep this serious up ❤

[@mangeshwaghambare]

Very well knowledgeable & informative video... Very good information

[@MILINb3E]

Due to english subtitles, important calculations are not visible. It's good narration.

[@ristondsouza8548]

Useful 💯 Thank you

[@bikendersingh4413]

Woow great way to teach RE nd all...thank u😊

[@gobaraGanesh]

Thanks for explaining in Hindi

[@anilmm2005]

Excellent information

[@suvradattajena3376]

From investment yadna to zerodha good progress mam😊

[@akshayojha3666]

👍 Very good explanation thank for informative video

[@omprakashboda2734]

Thanks for providing the Knowledge on Rights Issue.. One Question.... Balance amount of Right issue , when to be paid .... And how they intimate us for balance payment. Please clarify....🙏

[@arche6188]

Hello, thanks for the great content you make on varsity. I would love to see a video explaining about partly paid up shares, like Airtel pp e1 that happened in 2021. Like why they exist in such a way , dividend structure etc. Thank you.

[@surajdarekar8929]

Very informative!!!

[@arupdeb9663]

Hat's off to you Ma'am, very impressed by your way of explaning. One doubt I have, What market price should we consider, price at the time of rights entitlement or the price at the time of record date.

[@alokverma1792]

Please cover corporate actions like Bonus, Split etc. How a fresh issue is adjusted in the companies account. Does it dilute the shareholder's equity?

[@satishb700]

Bahuth accha samajata mam thanks mam

[@rajeshsamant4884]

Very helpful as Orient Green Power will open on Monday. Assuming tomorrow closing price for Orient is 14 and RI price is fixed at 10. So my RI sell price will be 4 on Monday or 10. Please guide .

[@jayeshparmar1554]

Nicely explain ❤

[@kg3217]

Kaafi achhe se explained tha. Thanks !

[@jayprakashmaurya9079]

Aree bhai but listing price pta kaise chle ga ?

[@FoxbatFury]

Best video on this topic

[@AdityaSharma-ol4vy]

Amazing ❤

[@melvinselvaraj]

Thank you ❤

[@HarikiranBaratam]

Thank you madam. 🙏

[@satyapriyaashish9656]

what to do with Indiabulls finance right issue? Should we sell it or apply for it?

[@tjtj2919]

I saw today n subscribed thanks a tons 👍

[@hanurao8078]

It's very good video.plz do video on warrants and buyback of share

[@harry5667]

Can you create a video where we can sell or buy shares using zerodha portal?? I am still confused, if we want to sell rights issue shares . Do we need to apply on ABSA bank portal? Or just demat account sell would be enough.

[@pankajgoyal5703]

Nice info

[@nikhilgala25]

amazing content, animations . amazing learning !

[@kamalchakraborti1353]

if anyone applies for all his RE share will he get same amount of new shares or it'll be based on lottery?

[@Rakeshshanmugamexplores]

Could you please share how to apply for the rights issue from zerodha step by step with example, like how you showed it for selling of Rights issue

[@AmitGuptaGwl]

Though it is good explanation. But it was not mentioned how to buy or sell. What options we have on Zerodha UI to do this

[@gobaraGanesh]

Thanks

[@ganeshbharati2310]

thanks madam. please make one full video about of iceburge order.

[@varunvvp7919]

What will happen if a non share holder bought RE and he doesn't sell those? will it come to his holdings and at what price??

[@HarryKrishna0410]

One question I am not getting an answer for, is that if a rights entitled person (who applied and bought RE shares) sells them, who buys them and why. If somebody buys these RE shares, it must be for some profit speculation. So it will be better to hold these shares.

[@ashishmanocha1234]

What if I buy more re shares from open market then can I apply for more shares at right issue price than my actual entitlement?

[@utkarshsharma9965]

@09:01 What is the listing price? Is it the price when the stock was listed?

[@jayprakashmaurya9079]

Same i don't understand

[@sanjaydhariya184]

Hello Madam, What about unlisted share's right issue? It can not be sold online.

[@bintu8989]

What is EMA? How to Use Exponential Moving Average With Formula how to excel in excel please make a detailed video mam ji

[@gohilraj1]

Mere pass Nagreeka expotrs ltd ke 2000 share hai. Jo maine 78.50 Rs price per share liya tha. Ab company ne right issue kiya hai jiski price rakhi hai 20 Rs per share. To muje kya karna chahiye taki mujhe profit ho. Pls reply.Right issue ratio 3:2

[@arijitmallick7058]

Pls make videos on commodity ,currency and govt securities by zerodha module---where no video has been made so far

[@rahulshetty1625]

But how to apply for RE? Is it supposed to be done on kite?

[@SujitKumar-eq3ye]

mere pass vms .RE kaa 1330 share hai 3.8 price pe 10 may tak last trading date thaa aur 16 may tak last apply date . 1. how to applyfrom zerodha 2.ye gir ke 2.20 price pe aagaya hai 3.agar apply naa kare to kya ye saare share aur paisa dub jayega. 4.apply karte hai to kya phir se payment karna padta hai.

[@rupeshr8339]

Can you please tell me, If i am not shareholder of company, supposed i buy Re Share from open market 100 qty at the same time apply for 100 Qty form ASBA then i can get all 100 Qty or not ? (Chances of allotment in %) I just want to know is this risk to do this bcz RE share will not appear after RE period over, if no allotment money use to buy RE will be not refunded? Am i correct?

[@bibhasnandi88]

Please this type of vedio send regarding Ibull housing finance which will be more helpful for new subscribers and likers. Thanks.

[@mukeshchoby]

mam agar right issue ke share purchase kar liya kya long term rakh sakte h

[@sheikhfarzyn1283]

Hi, Thanks for creating this content. Can you please help me understand the reasoning behind this> LP>RE then Sell; LP

[@sheikhfarzyn1283]

Listing price mentioned here is for what time frame?

[@pragashr2611]

What is the listing price? Is it same as the issue price of rights?

[@kuoshsethh452]

What is the listing price ? Confused

[@jayprakashmaurya9079]

Same guys even I am not able to understand what is listening price

[@imamshaikh7086]

I have an Orient Green Power shares. And, they are coming with Rights Issue soon. If, I create a ticket on Zerodha about my all details then can a Zerodha advice me or answer me regarding the sell or apply for the Rights Issue of my share i.e. Orient Green Power? Please, reply. I am a Zerodha Kite user.

[@varshasinha4184]

If u sell it and then rebuy it within the same time frame..my genpharma re now is at an investment of 4500..and i dont know wt to do..i rebought it by mistake at its max price 2.66😢

[@harishkenchugonde3880]

Lot of confusion with rights entitlement and right issue🥵🥵

[@tradenowornever2858]

Procedure to apply RE???

[@kishorkurle2431]

How to apply from zerodha for sepc stock ?

[@user-nv2gj6lg7e]

But as per provision 53 Issue of shares at discount is prohibited how it is 🤔

[@dipakangayte7529]

I have 1500 share of ibull then what happened when im not applied for right issu. My holding is remaining as its or what. Plz reply mam plz.

[@gokulanandaadhikari8680]

What if the rights are not allotted to me? Do I lose the value of my RE?

[@amitrana8563]

first of all, this is the most effective video i found when comes to the right issue. I have few doubt can some help pls ? i hold 810 stocks of indiabulls, now one 8th i applied for RE stockers i.e. 410 where my 15k amount was deducted. now on 11th i blocked my 20K for 410 right issue via my icici net banking app. now i have two questions 1. What about the token value(15K), will it count when i will receive the stocks 2. Is am going in the correct direction or i missed something ?

[@YashikaKoshti]

But how can sell before buy

[@deboprasadbiswas1987]

Madam, agar hum right issue se mile hua share sell kar denge to fhir humare portfolio me add kaise hoga??

[@kuoshsethh452]

What is the listing price ? How is it derived ?

[@safdaraziz9906]

What is the listing price here? This piece of puzzle is making things hard to understand. Please clarify

[@roshin4u]

12.48minutes calculation screen equation on Cell D is not clear, how the value 9 ( A*9) appear

[@gokulakannan818]

For the sake of non-hindi speakers, can we have future videos in English please?

[@rajshrivastav8690]

Turn on caption

[@sohamdutta.]

No need

[@youngsteronline]

Hindi seekh lo , kya h burai h

[@SpaceTimeBeing_]

​@@youngsteronlinebruh, that's like asking beggers to just get rich. India is diverse with great older languages. Let they help everyone.

[@dream_cricket_dhoni]

No

[@akshayverma5589]

I have already applied for south indian bank, but currently not viewing in holding.

[@ronidas4180]

Confusion about Indiabull housing finance right issue Holding qty 70 @218 Current price 189 What to do madam Apply or sell

[@spiritualsystems]

Informative but I still dont know how to proceed to sell or buy

[@vidhatelakhan2618]

If no net banking then how to apply for right issue

[@mohitbajaj6532]

Sell karne k liye money kidr hona chahiye demat account pr ? Plss reply

[@dileepkumarkatiyar9118]

Agar right issues ko buy kar liya to kya hoga. Pls comment

[@the-brownwhale]

Not all zerodha users speak Hindi. Samjae?!

[@ikpsanjay1010]

sheekh le lamde phir

[@Solotravelerajitesh]

If possible please show any demo for kite

[@user-lv2yw9jl9p]

Re ke share holdig me kab aate hai please Ripley

[@akhileshshukla4768]

RIGHT ISSU KO MARKET PRICE ME SELL KAR SAKTE HAI KYA

[@pinakinandanbehera531]

How to know the listing Price...?

[@DevC-mt2md]

At 8:39 you mention listing price. How / where can we find this value?

[@sachinbpathak]

Please share if you find an answer to this.

[@dsmapari]

Ma'am make a video on IIFL RE.

[@ganeshmapari438]

RE of IBHF is reflecting in my demat I purchased that by paying Rs 48 per share and that amountis debited from account. Tell me is it the correct step to buy RE or I mistaken.

[@virendratatuskar3903]

No your in loss

[@nayanmoradiya2858]

Right issue add hokar price avrge ho jata he ne??

[@pramodchavan7197]

sir me options sell che traed denar , tumhi ghenar ka/😉

[@user-or1td9tr4r]

What happens if right issue under subscribed.

[@bharatgupta3287]

What is listing price?

[@farmanansari9766]

i have 24000 share of Dipna pharma ltd, i want to buy right issue share. do i need to apply or they will reflect in my portfolio without any application? and what about their payment because these are fully paid share. i dint know the process of applying right issue shares?

[@shivasiddharthnarayanan]

What is meant by STT ?

[@Mahesh-tv6xo]

I bought RE yesterday and applied for shares through SBI ASBA yesterday evening. Will my application be rejected because I applied for shares even before RE reached my demat account ?

[@Mahesh-tv6xo]

It is regarding GRASIM RE

[@pristine2515]

What is the listing price and how to get that for any RE?

[@DevC-mt2md]

Please share if you find an answer to this?

[@bhairuprakashsharma6557]

Maine ibull में अप्लाई नही किया है तो मेरा अब क्या होगा?

[@vishalwarale5937]

Nice explanation and pretty u r

[@kikiindia]

South Indian Bank ka right issue Aya hai to mere purana South Indian Bank ke share hai to vo bechna hoga

[@vaibhavjain5449]

Nice job madam Eg IBulls Housing Finance ka leke samaja please

[@goldensingers01]

Madam namaskar. Maine September mahine mein Orient Green Power. K Re Sher open market se Apne paise se10000 Sher purchase kiya tha lekin Maine apply nahin kiya tha bad mein mere demat account se debit ho gaye hain to please ab kya karna chahie

[@varsitybyzerodha]

Hi, we're sorry about this. Could you please create a ticket on: support.zerodha.com/ with details of the issue, so we can have this resolved at the earliest?

[@mahmoodalam2187]

Apne rishtedar ke favour me kis tarah bechenge ya kis tarah authorise karenge ki yeh share unko mil jaye. Is point par aap ne kuchh nahi bataya

[@ramsagar8945]

i am not a shareholder of any share but i buy RE SHARE , then how can i apply RIGHT ISSUE ? ONLINE OR OFFLINE?

[@srinivaschandrakala]

How did you buy RE share. Please explain step by step. It would be helpful for many

[@CBS1611]

🤩🤩🤩