Optionally convt debenture
This query is : Resolved
sajjala Joshi
(Querist)
16 March 2012
What is the meaning of optionally convertible debentures?
Ajay Mishra
(Expert)
16 March 2012
Hi
Classification on the basis of convertibility
These debentures are issued by a company on the basis of option provided to them for conversion of debenture in the equity shares of the company after a certain period. It may be classified in the following categories:—
(a) Fully convertible debentures (FCDs).—These debentures are converted into equity shares of the company on the expiry of a specified period.
(b) Partly convertible debentures (PCDs).—Partly convertible debentures are divided into two portions, viz., convertible and non-convertible portion. The convertible portion is converted into equity shares of the company at the expiry of specified period. The non-convertible portion is redeemed at the expiry of the specified period in terms of there issue.
(c) Non-convertible debentures (NCDs).—Non-convertible debentures do not have any option to convert the same into equity shares and are redeemed at the expiry of specified period(s).
Regards
Classification on the basis of convertibility
These debentures are issued by a company on the basis of option provided to them for conversion of debenture in the equity shares of the company after a certain period. It may be classified in the following categories:—
(a) Fully convertible debentures (FCDs).—These debentures are converted into equity shares of the company on the expiry of a specified period.
(b) Partly convertible debentures (PCDs).—Partly convertible debentures are divided into two portions, viz., convertible and non-convertible portion. The convertible portion is converted into equity shares of the company at the expiry of specified period. The non-convertible portion is redeemed at the expiry of the specified period in terms of there issue.
(c) Non-convertible debentures (NCDs).—Non-convertible debentures do not have any option to convert the same into equity shares and are redeemed at the expiry of specified period(s).
Regards
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