An Unrenounceable Rights Issue allows existing shareholders to buy discounted shares, but the rights can’t be sold or transferred; unused rights simply lapse.
An Unrenounceable Rights Issue is a type of rights offering in which existing shareholders are given the option to buy additional shares at a discounted price, but unlike a renounceable rights issue, the rights cannot be transferred or sold to other investors. Shareholders who do not wish to exercise their rights lose them, and no one else can purchase those rights.
This type of offering is typically used by companies that want to raise capital from their existing shareholders without giving them the option to sell their rights in the market. It ensures that only current shareholders benefit from the offering.
Example: A company offers 1 new share for every 10 shares held at ₹50 per share. A shareholder with 100 shares must buy 10 new shares at the discounted price, and cannot sell or transfer the rights to others.
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