Dhanlaxmi Bank Share Price Falls Over 9% After Stock Turns Ex-Date For Rights Issue
The board of Dhanlaxmi Bank, on Dec. 19, approved to raise up to Rs 297.54 crore by issuing 14.16 crore fully paid-up equity shares through the rights issue.
(Photo source: NDTV Profit)
Shares of Dhanlaxmi Bank Ltd. slipped over 9% after turning ex-date for the right issue on Friday. The stock touched an intraday low of Rs 32.55 apiece on the NSE, nosediving by 9.28% as compared to its adjusted price of Rs 35.88 apiece. Dhanlaxmi Bank share price had closed at Rs 44.21 on the NSE on Thursday.
The sharp drop in the share price was a result of the stock turning ex-date for the rights issue today.
The board of Dhanlaxmi Bank, on Dec. 19, approved plans to raise up to Rs 297.54 crore by issuing 14.16 crore fully paid-up equity shares through the rights issue. The rights issue price had been fixed at Rs 21 per share, which included a premium of Rs 11 per share.
Eligible equity shareholders received 14 shares for every 25 fully paid-up shares held as of the record date, set for Friday, Dec. 27.
The subscription window for Dhanlaxmi Bank rights issue is scheduled to be open between Wednesday, Jan. 8 and Tuesday, Jan 28.
A rights issue enables existing shareholders to buy additional shares directly from the company at a predetermined price, typically at a discount to the market price (Thursday's close was Rs 44.21), in proportion to their current holdings. It is a fundraising strategy whereby companies raise capital by offering existing shareholders the opportunity to buy more shares at a discount.
The record date of a rights issue determines which shareholders are eligible to participate in the rights issue. Investors who purchased shares by Thursday, Dec. 26, on a T+1 basis, will be eligible for the issue.
Dhanlaxmi Bank share price was trading 8.19% down at Rs 32.94 apiece on the NSE at 10:28 a.m. In comparison, benchmark Nifty 50 was up 0.69% at 23,912.9 points at the same time.
