Reliance Industries’ (RIL’s) mega rights issues will put to test the platform for trading rights entitlement (RE) introduced by the Securities and Exchange Board of India (Sebi) earlier this year.
The platform allows eligible shareholders to renunciate their shares for a price. Industry players say in the case of RIL, the shareholders can look to pocket as much as 15 per cent of the value of eligible shares.
Until now, shareholders, who didn’t wish to apply, had to let their RE lapse or had to transfer it for free. The trading in RE will open, along with the rights issue, on May 20 and close on May 29. Meanwhile, the rights issue will remain open until June 3.
“The right entitlement process is new for all market participants and will be tested in a big way,” said Mohit Mehra, business analyst at Zerodha.
