Rights issue and Bonus are completely different things. In rights issue, company issue equity and rise capital and in case of Bonus issue, company issue equity freely without rising capital.
All the rights issues are issued at substantial discount to the share price (like upto 50%) but incase of Heritage this is exaggerated to 90% which definitely not a right thing. However, in every rights issue, investors loose money if they are don’t actively participate in it or if they don’t sell the rights equity on time. As an individual investors, its investors responsibility to actively follow the exchange announcements and checking email notifications etc.
Disclosure: Invested
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The purpose of rights issue is to raise money. Period.
Here, they issues rights share at Rs.5 against cmp of 300+! They weren’t really raising money but was equivalent to bonus issue, yet they didn’t give bonus but did right issue to gain some more shares in place of innocent retailers.
This is definitely wrong on part of promoters
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Wonder what has Naidu got to do with Heritage? Is he involved in day-to-day operations? Is the company involved in any fraudulent activities? The management has years of experience in the dairy and FMCG sector both in India and western economies, has negligible debt, high return ratios, partnerships with multinational dairy brands, sometimes people just want a reason to instill fear using irrational rationale
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