Rights Issue or Rights Entitlement (RE)
A Rights Issue is when a company gives its existing shareholders the option to buy more shares, usually at a discount, to raise funds. The Rights Entitlement (RE) is the temporary right you receive, which you can either use to apply for these shares or sell in the market to another investor.
The RE process has several key stages, and RE shares appear in your holdings only after allotment and listing. Here’s a quick breakdown:
- Record Date: If you hold shares on this date, you’re eligible for Rights Entitlements.
- RE Credit: REs are temporarily credited to your demat. These are not actual shares but entitlements to apply for them.
- Application Window: Apply for the shares by paying the application amount (via ASBA or RTA portal).
- Allotment: After the window closes, shares are allotted to successful applicants.
- Listing: Allotted shares are listed and then reflected in your holdings.
Alternatively, you can also sell your REs in the stock market as individual instruments.
Note: RE shares will be visible only after allotment and listing, which can take 4–6 weeks.
Let’s understand further with different scenarios:
| Scenario | What it means for you |
|---|---|
| I missed the RE trading window | Your REs will expire and have no value. |
| I bought REs from the market, but didn’t apply | You won’t get any refund—REs must be exercised to get shares. |
| I hold shares but didn’t get REs | Check if you held the shares on the record date and if your demat account is active. |
| I bought REs, but don’t see them in my holdings | REs are temporary rights. It will expire once the RE window closes. |
| I applied but shares are not credited yet | Shares are credited a few days after the issue closes. So, if the issue window is not closed, please wait until then. |
If you still face any issues with Rights Issue or REs, please reach out to our support team by raising a ticket.
