Why promoters issue warrants

If the prices were higher, they would convert those warrants and at least make a paper profit, and in some cases encash the gains. If promoters or promoter groups sold shares in the previous six months, they would not be eligible for allotment on preferential basis either, said Mr Bhave. Retail limit in IPOs doubled. SpiceJet to issue 6. SpiceJet shareholders have approved issuing of more than 6. SpiceJet to issue warrants to promoters for fund raising. The board of directors at a meeting on January 9, decided to issue up to 6,41,69, warrants of the face value of Rs 10 each on preferential basis to promoters with the option to apply for and be allotted an equivalent number of equity shares, SpiceJet said in a BSE filing today.

These warrants are convertible to shares at a price fixed on the basis of Sebi formula — The average of closing prices of the share on a stock exchange in the last six months. The rest can be paid in 18 months. Issuance of warrants needs ratification by a common shareholders meeting. But in most of the cases, the promoters get such resolution passed.

CLB rejected HB's plea. Now, it has moved to the high court against CLB order. Consultants say allotment of warrants to promoters is a clear case of insider trading. Promoters, being part of the management, know future prospects of the company very well. Normally, promoters go for warrants when the share prices of companies are at low levels. Brand Solutions. Video series featuring innovators. ET Financial Inclusion Summit.

Malaria Mukt Bharat. Wealth Wise Series How they can help in wealth creation. Honouring Exemplary Boards. Deep Dive Into Cryptocurrency. ET Markets Conclave — Cryptocurrency. Reshape Tomorrow Tomorrow is different. Let's reshape it today. Corning Gorilla Glass TougherTogether. ET India Inc. ET Engage. ET Secure IT.