How to calculate rights shares of an individual (taking an example of 100 shares)?

Practical Calculations of Rights Shares (Indian Rupees)

Let’s consider an example with an individual holding 100 shares of a company before a rights issue.

Before Rights Issue:

• Number of shares held by the individual: 100
• Market price per share: ₹200

Company announces a 1-for-2 rights issue at ₹150 per share.

Rights Issue Details:

• Rights ratio: 1-for-2 (i.e., 1 new share for every 2 existing shares)
• Subscription price per rights share: ₹150

Summary of Changes for the Individual Shareholder

• Before Rights Issue:
  • Number of Shares: 100
  • Market Price per Share: ₹200
  • Total Value of Shares: 100×₹200=₹20000
• After Rights Issue:
  • Number of Shares: 150
  • Theoretical Ex-Rights Price per Share: ₹183.33
  • Total Value of Shares: 150×₹183.33=₹27500

CLICK HERE – for detailed calculation of Rights shares.