Announcements

EIH Ltd in an attempt to raise Rs. 350 crore has decided to release a rights issue. The issue price per share has been fixed at Rs. 65 and the rights issue is set to close on 9th October 2020. Here’s a little more about this.

Understanding what a Rights Entitlement is
A company may resort to various means of raising capital while pursuing expansion goals, attempting to achieve a debt-free status or building new assets. One such means is a rights offer. This involves entitling existing shareholders to a specific number of rights as per the ratio set by the company.

Thus, rights entitlement offers existing shareholders the chance to buy more shares in the company at a discounted price over a specific period of time.

In the case of EIH Ltd Rights Issue, the proportion issued is 8:85. This means if you own 85 shares of EIHOTEL, you’re entitled to 8 of its shares in this rights entitlement.

Important dates to keep in mind for the rights issue
While the rights issue closes on 26th August, here are other dates to keep in mind.

29th September  – Listing of rights entitlement on the exchange
1st October – Rights entitlement credited to your Demat account
8th October – Last day to trade your rights

In case, you do not wish to subscribe to or forfeit your rights, it is advisable to sell these on the market on or before 8th October 2020.