Is it allowed that a company pay dividend with equal rate on class A and classB shareholders?

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What does company act and sebi says about class A and Class B shares . Can dividend be equal on both class of shares?

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  • Contractual Basis: The dividend payout must align with the terms specified when the shares were issued. If the issue terms state that Class A gets $X\%$ and Class B gets $Y\%$, the company must comply with those terms.

  • Approval: Any dividend payment—whether equal or different—must be recommended by the Board of Directors and approved by the shareholders as per the company's policy and Articles of Association.

  • Flexibility: While a company can choose to pay the same rate on both classes, it is not legally obligated to do so unless the articles or the specific terms of the share issue mandate equality.

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