Calculate your rights entitlement and investment impact
Ratio 2:1 means 1 new share for every 2 shares held
Rights Entitled
50
shares
Rights Subscribed
50
shares
Investment Required
₹20,000
Total Shares After
150
shares
TERP
₹466.67
Theoretical Ex-Rights Price
New Average Cost
₹466.67
per share
Portfolio Value
₹70,000
at TERP
Before Rights Issue:
100 shares @ ₹500 = ₹50,000
After Rights Issue:
150 shares @ ₹466.67 avg cost
You are entitled to 50 rights shares. By fully subscribing, you'll invest ₹20,000 and reduce your average cost from ₹500 to ₹466.67 per share.
💡 Tip: Compare the rights price (₹400) with market price (₹500). The 20.00% discount makes subscribing attractive if you believe in the company's fundamentals. Alternatively, you can sell your rights entitlement in the market if you don't want to invest more.
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View Premium PlansThis calculator is for informational and educational purposes only. It does not constitute financial or investment advice. Consult with a qualified financial advisor before making investment decisions.
A Rights Issue Calculator helps existing shareholders calculate their entitlement when a company offers new shares through a rights issue. Rights issues give existing shareholders the right (but not obligation) to buy additional shares at a discounted price in proportion to their current holdings. This calculator determines how many rights shares you're entitled to, investment required, new shareholding, and the impact on your average cost per share.
If you don't subscribe, your shareholding percentage will get diluted. Your existing shares remain but represent a smaller portion of the company. The stock price typically adjusts to TERP post-rights, which may be lower than current price. You can sell your rights entitlement in the market if you don't want to subscribe.
Yes! Rights are tradeable on stock exchanges during the rights issue period (usually 15-30 days). If you don't want to invest more money, you can sell your rights to other investors. The rights trade separately with suffix like '-RE'. Selling rights helps recover some value instead of letting them lapse.
Companies use rights issues to: 1) Raise capital for expansion, debt reduction, or acquisitions, 2) Offer existing shareholders a chance to maintain ownership percentage, 3) Raise funds at lower cost than public offering, 4) Reward loyal shareholders with discounted shares. It's generally positive if funds are used productively.
TERP (Theoretical Ex-Rights Price) is the expected stock price after rights issue. Price falls because: 1) Total shares increase (dilution), 2) New shares issued at discount, 3) Value spreads across more shares. Example: ₹500 stock with 2:1 rights at ₹400 will theoretically trade at ₹466.67 post-rights.
Consider: 1) Use of proceeds - Is company using funds productively? 2) Company fundamentals - Strong business worth additional investment? 3) Your portfolio - Do you want to increase exposure? 4) Opportunity cost - Better investments elsewhere? 5) Rights premium - Can you profit by selling rights instead?
Short term: Stock price adjusts to TERP, may show paper loss initially. Long term: If company uses funds well, your investment grows. Your average cost decreases, making future gains more likely. Calculate: (Current Price - New Average Cost) × Total Shares to see your position.
You can subscribe to any number of rights up to your entitlement. Unsubscribed rights lapse or can be sold. Partial subscription means partial dilution protection. Your shareholding percentage decreases less than non-subscribers but more than full subscribers. Use this calculator to model different scenarios.