The Rs 53,125 crore rights issue of billionaire Mukesh Ambani’s Reliance Industries Limited (RIL) opened for subscription today (May 20). The issue closing date is June 3.
Reliance Industries Limited (RIL) rights issue are priced at Rs 1,257 per share with share ratio at 1:15. The issue amount is Rs 53,125 crore. The payment terms will be 25 per cent on application and balance in or more calls.
On application, the shareholders will pay Rs 2.50 on face value and Rs 311.75 on premium, totalling to Rs 314.25 per rights equity share. The remaining Rs 942.75 will be payable in one or more subsequent calls as determined by the board of directors from time to time.
Experts advise existing investors to subscribe to the rights issue given the expected healthy growths Reliance’s Jio platform.
“We advise existing shareholder/investors to exercise the rights and ‘Subscribe’ to the issue offered by RIL which is similar to that of investing in a company future growth and remain invested in the stock for at least 2-3 years to see the benefit colouring,” a Moneycontrol report quoted Prashanth Tapse, AVP Research at Mehta Equities as saying.
This is the first rights issue by RIL in nearly three decades.
A rights issue is an instrument for a listed company to offer its existing shareholders the chance to buy additional shares for a reduced price. Usually, the discounted price will stand for a limited time frame, after which it returns to the normal pricing.