Home >

The Difference Between Rights Issue And Dividend Payment

2011/8/5 18:35:00 68

1. rights issue is not dividend.

A bonus

The return of listed companies to shareholders is characterized by: the listed company is the payer, the shareholder is the harvester, and the shareholder gains the operating profit of the listed company, so dividends are built on the basis of the profits of the listed companies, and no dividends can be divided without profits.

The dividends of listed companies usually come in two forms, one is to send cash dividends, that is, a portion of the profits of a listed company will be returned to shareholders in a certain period (usually a year) in cash, so as to repay shareholders' investment, and the other is to send bonus shares, that is, the company should convert the cash dividend from capital stock into capital, so as to expand production and operation, and give shareholders a return in the coming year.

And the rights issue is not based on profit. As long as the shareholders are willing, even if the listed company loses its business, it can also issue shares. The listed company is the requester and the shareholder is the payer.

Shareholders make additional investments, and joint stock companies get capital to replenish their capital.

After the rights issue, although the stock held by shareholders is increasing, it is not a return from the company to the investors, but a certificate after the additional investment.

Why

Investors?

Will the rights issue become a bonus?

At this time, China's stock market and stock investors are not yet mature.

The modern Chinese stock market has been established for a relatively short time, and is in the process of development and maturity. The stock market is small and stocks are in short supply.

This reality greatly stimulates people's enthusiasm for speculation in the market, and the listed company is using this point to sell new shares to old shareholders at a low price, on the one hand, it has strengthened the financial strength of the company, and has also satisfied the stock investors' thirst for stock.

Two

Allotment of shares

Investment choice

According to the relevant provisions of the company law, when a listed company has to sell new shares, it should first be carried out among the old shareholders, so as to ensure that the shareholding ratio of the old shareholders is unchanged. When the old shareholders are unwilling to participate in the company's rights issue, it can pfer the allotment of shares to others.

For old shareholders, the rights issue of listed companies actually provides a choice of additional investment.

Whether the old shareholder chooses the rights issue to supplement the investment to the listed company can be judged according to the listed company's operating performance, the investment and the benefit of the rights issue fund.

But in the real economic life, besides the rights issue, shareholders can also make additional investments by buying shares of other companies, investing in claims and household savings, and the key is determined by the investment income.

If the return on equity of listed companies can not reach the interest rate of residents' savings deposits, it is obvious that the operating efficiency of listed companies is too poor, and their return on investment is difficult to compare with household savings. Investors can not choose the rights offering method to supplement investment in listed companies.

Of course, when a listed company determines the rights issue, if the warrant is not circulated, the rights issue will be mandatory, because the stock will have to be removed after the rights issue is implemented, and the price will drop. If the old Gu Dong does not participate in the rights issue, it will suffer the loss of market value.

The only way to escape the rights issue is to throw the stock out before the issue of shares.

In the rights issue of Listed Companies in China, because the operation of stock system in China is not yet standardized, the domestic and legal person shares of listed companies occupy an absolute controlling position. These big shareholders strongly approve of the rights issue but do not have the capital contribution to participate in the rights issue, and they also pfer their shares to the shareholders of the listed company.

Such a move is actually a violation of the rights and interests of minority shareholders.