Rights Issue of Shares raise capital from existing shareholders, compliantly.
A rights issue allows a company to raise fresh capital by offering new shares to its existing shareholders in proportion to their current holding — a faster, lower-cost route than a public issue, governed by Section 62(1)(a) of the Companies Act.
Contact UsA rights issue is an offer of new shares made by a company to its existing shareholders, in proportion to their existing shareholding, giving them the first right to subscribe before the shares can be offered to outsiders. It is one of the most common ways for private and unlisted companies to raise further capital from existing investors without triggering the more elaborate private placement process.
Section 62(1)(a) of the Companies Act 2013 governs rights issues — requiring the offer letter to be sent to all existing shareholders, a minimum offer period of at least 15 days (and not more than 30 days) for shareholders to accept, and the right for shareholders to renounce their entitlement in favour of another person unless restricted by the articles.
At Beyonte Compliances, we manage the entire rights issue process — board approval, drafting the letter of offer, calculating entitlement ratios, tracking acceptances and renunciations, and completing the allotment and ROC filings.
What Our Rights Issue Service Covers
Entitlement Calculation
Calculating each shareholder's rights entitlement in proportion to their existing shareholding as on the record date.
Board Approval
Preparing the board resolution approving the rights issue, offer price, and the letter of offer to be circulated.
Letter of Offer Drafting
Drafting the letter of offer under Section 62(1)(a) specifying the number of shares, price, and time period for acceptance.
Offer Period Management
Managing the mandatory 15 to 30 day offer period during which shareholders can accept, decline, or renounce their entitlement.
Renunciation Handling
Processing renunciations where existing shareholders wish to transfer their entitlement to a third party, subject to the articles.
Allotment Resolution
Preparing the board resolution for allotment of shares to shareholders who have accepted the offer.
PAS-3 Filing
Filing Form PAS-3 with the Registrar of Companies within the prescribed timeline following allotment.
Share Certificate Issuance
Coordinating issuance of share certificates or demat credit to the successful allottees.
Our Process
Board Approval
Convening the board meeting to approve the rights issue size, price, and record date.
Letter of Offer
Issuing the letter of offer to all existing shareholders setting out their entitlement and the offer window.
Acceptance Window
Allowing shareholders the statutory 15-30 day window to accept, renounce, or let the offer lapse.
Allotment
Allotting shares to shareholders who accepted, and to renouncees where entitlements were transferred.
ROC Filing
Filing PAS-3 with the Registrar of Companies and updating the register of members.
Why It Matters
Frequently Asked Questions
Raise capital from your existing shareholders the right way.
Talk to our team about structuring and executing your company's rights issue.