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Chapter: 12th Accountancy : Company Accounts

Company Accounts | Accountancy | Study Material, Lecturing Notes, Assignment, Reference, Wiki description explanation, brief detail |

Issue of equity shares

A public company may raise capital by issue of equity shares through the following ways:

Issue of equity shares

A public company may raise capital by issue of equity shares through the following ways:

1. Public issue

2. Private placement

3. Rights issue

4. Bonus issue

 

1. Public issue

Issue of equity shares to the public through prospectus by a public company is called public issue. It includes initial public offer and further public offer.

2. Private placement

Private placement means any offer of equity shares or invitation to subscribe equity shares to a select group of persons by a company (other than by way of public offer) through issue of a private placement offer letter and which satisfies the conditions specified in Section 42 of the Indian Companies Act, 2013.

3. Rights issue

Issue of equity shares to the existing shareholders of the company through a letter of offer is known as rights issue.

4. Bonus issue

Issue of equity shares to the existing shareholders of the company at free of cost out of accumulated profit is known as bonus issue.

Tags : Company Accounts | Accountancy Company Accounts | Accountancy
Study Material, Lecturing Notes, Assignment, Reference, Wiki description explanation, brief detail


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