Types of Debentures

There are several types of debentures on the basis of security, performance, priority, convertibility and Records. On the basis of security Naked Debentures: These Debentures are not secured against any assets of the Company. In case of winding of the company, debentures holders holding unsecured debentures treated as unsecured creditors. Secured Debentures: These Debentures are secured […]

Difference between share and debenture

The key difference between a share and a debenture is that while share represents part of ownership of a company,  debenture acknowledges loan or debt to the company. Thus, a shareholder is a participant in the profits as well as losses of the company but a debenture holder is paid interest over the  life time […]

Debenture: Meaning, Types and Salient Features

A debenture is one of the capital market instruments which is used to raise medium or long term funds from public. A debenture is essentially a debt instrument that acknowledges a loan to the company and is executed under the common seal of the company. The debenture document, called Debenture deed contains provisions as to […]

Red Herring Prospectus

The literary meaning of idiom “Red Herring” is the rhetorical tactic of diverting attention away from an item of significance. In terms of capital markets, Red Herring Prospectus is a prospectus which contains all information about the IPO barring a few key details such as issue price. Draft Red Herring Prospectus The Indian regulatory framework […]

What is Prospectus in share markets?

Whenever shares are to be issued to the public, a company must issue a prospectus. The Prospectus contains relevant information like names of directors, terms of issue, etc. It also states the opening date of subscription list, amount payable on application, on allotment & the earliest closing date of the subscription list. Many companies float […]

Shares and Equity Shares

Every business needs some capital to start up. When a new business is started, the personal savings of an entrepreneur along with contributions from friends and relatives are the source of fund. The entrepreneur in this case can also be called a promoter. This may not be feasible in case of large projects as the […]

Preference Shares

Preference shares are one of the two kinds of shares which a company can issue, other being equity share or ordinary share. The Preference shares have preferential right to receive dividend at a fixed rate before any dividend is paid on the equity shares. When the company is wound up, preference shares have a right to return […]

Difference between Preference Shares and Equity shares

Key difference is that while Preference shareholders enjoy the benefit of receiving their dividend distribution first; the equity shareholders enjoy voting rights in major company decisions, including mergers or acquisitions.  A Company can issue two types of shares viz. Equity Shares and Preference Shares. Equity shares are also known as Ordinary Shares.  While Preference shareholders […]