Partly paid-up shares

Partly paid-up shares are shares in which the shareholder has paid only a portion of the total issue price, with the remaining amount due at a later stage. In an FPO, companies may offer partly paid-up shares to investors, allowing them to pay only a part of the share price initially. The rest of the balance is required to be paid according to the terms specified by the company.

These shares can be traded on the stock market, but shareholders must clear the outstanding dues before receiving full ownership benefits. Partly paid-up shares offer lower initial investment but carry future financial obligations.

Example:

Let's say a company offers shares at an issue price of ₹100 per share. However, the company decides to issue these shares as partly paid-up. In this case, the investor is required to pay ₹60 per share upfront, and the remaining ₹40 per share can be paid at a later date, as per the terms outlined by the company.

For example:

• Issue price: ₹100 per share
• Amount payable initially: ₹60 per share
• Remaining amount due: ₹40 per share, payable later

Investors can trade the ₹60-paid shares, but they need to clear the ₹40 balance when requested by the company to convert them into fully paid-up shares.