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Backseat to driver's seat: Rights issues take the wheel after Sebi's revamp

Faster allotments and streamlined processes put capital raising into high gear

rights issue, Securities and Exchange Board of India, Sebi, investment bankers, stock markets
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Rights issues allow listed firms to raise funds by offering existing shareholders new equity shares, often at a discount, enabling them to retain their ownership stakes

Sundar Sethuraman

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Fundraising through rights issues has picked up after the Securities and Exchange Board of India’s (Sebi’s) updated regulations came into force in early April.
 
In May, four companies raised ₹4,188 crore via rights issues — the highest monthly total since January 2024. Key offers included Mahindra & Mahindra Financial Services (₹2,996 crore), Lloyds Engineering Works (₹987 crore), Max India (₹124 crore), and Avantel (₹81 crore). In April, Fusion Finance raised ₹800 crore. This month, at least six more rights issues — including UGRO Capital’s ₹400 crore offer — have opened for subscription.