NISM Series XV : Research Analyst Certification Exam Notes
Page 14 Of 62
Go to:
An investor who has been awarded right shares has three options: (i) Exercise the right (ii) Transfer the right to another investor or (iii) Let the rights lapse i.e. do nothing.
Onshore and Offshore Offerings - While raising capital, issuers can either issue the securities in the domestic market and raise capital or approach investors outside the country. If capital is raised from domestic market, it is called onshore offering and if capital is raised from the investors outside the country, it is termed as offshore offering.
Offer for Sale (OFS) is a form of share sale where the shares offered in an IPO or FPO are not fresh shares issued by the company, but an offer by existing shareholders to sell shares that have already been allotted to them. An OFS does not result in increase in the share capital of the company since there is no fresh issuance of shares. The proceeds from the offer go to the offerors, who may be a promoter(s) or other large investor(s).
OFS - eg - Disinvestment of PSU by Indian Govt. OFS is a secondary market transaction done through the primary market route.
Sweat Equity - Under Sec.54 of Companies Act, 2013, a company may issue shares to its employees, promoters, technocrats, or others as reward for their contribution to the company. These shares are referred as sweat equity.
MODELEXAM® 
www.realsoftinfoplan.com