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Why are rights issue offered?

Zerodha (Flat Rs 20 Per Trade)

Invest brokerage-free Equity Delivery and Direct Mutual Funds (truly no brokerage). Pay flat Rs 20 per trade for Intra-day and F&O. Open Instant Account and start trading today.

Rights issues are offered by the companies to raise additional capital for various purposes.

A company may issue rights account of various reasons as per below:

  1. The company has become cash strapped and needs funds.
  2. For company expansion, takeovers, mergers, acquisitions.
  3. To purchase equipment.
  4. For general corporate purposes.
  5. To repay the loan.


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