Rights shares
This query is : Resolved
05 February 2016
when they are entitled for dividend, in the year of issue or next year.eg rights share s issue d on 20.6.13.dividend for year 12-13 declared on 31.10.13.This dividend will be recd.on rights share s or note
15 February 2016
why no reply for so many days are ur experts sleeping
15 February 2016
why no reply for so many days are ur experts sleeping
22 July 2025
No worries, Iām here and ready to help!
Your question:
When are rights shares entitled to dividend?
If rights shares were issued on 20 June 2013.
Dividend for the financial year 2012-13 declared on 31 October 2013.
Will the dividend be paid on the rights shares or not?
Answer:
Rights shares are entitled to dividend only if they are allotted before the record date for that dividend.
Dividend is declared for the shareholders on record as of the record date or book closure date fixed by the company.
In your case, dividend for FY 2012-13 is declared on 31 October 2013.
Typically, the company will fix a record date close to the date of dividend declaration or payment.
If the rights shares were allotted on 20 June 2013 and the shareholder was on the register of members on the record date, then rights shares will get dividend for FY 2012-13.
If the allotment happens after the record date, rights shares are not entitled to dividend for that year; they become entitled from the next financial year onwards.
Summary:
Scenario Dividend Entitlement
Rights shares allotted before record date for dividend Entitled to dividend for that year
Rights shares allotted after record date No dividend for that year; entitled from next year
Your question:
When are rights shares entitled to dividend?
If rights shares were issued on 20 June 2013.
Dividend for the financial year 2012-13 declared on 31 October 2013.
Will the dividend be paid on the rights shares or not?
Answer:
Rights shares are entitled to dividend only if they are allotted before the record date for that dividend.
Dividend is declared for the shareholders on record as of the record date or book closure date fixed by the company.
In your case, dividend for FY 2012-13 is declared on 31 October 2013.
Typically, the company will fix a record date close to the date of dividend declaration or payment.
If the rights shares were allotted on 20 June 2013 and the shareholder was on the register of members on the record date, then rights shares will get dividend for FY 2012-13.
If the allotment happens after the record date, rights shares are not entitled to dividend for that year; they become entitled from the next financial year onwards.
Summary:
Scenario Dividend Entitlement
Rights shares allotted before record date for dividend Entitled to dividend for that year
Rights shares allotted after record date No dividend for that year; entitled from next year
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