Yes. If you don’t want to subscribe to a rights issue, you have the option to renounce your entitlement either fully or partially in favour of someone else.
Renouncing means transferring your rights entitlement to another person. That person can then apply for the shares in your place at the same offer price. You can renounce in favour of anyone a family member, friend, or even an outside investor.
SEBI has made rights entitlements (REs) tradeable on the stock exchange. This means instead of formally renouncing to a specific person, you can simply sell your RE on the exchange during the trading window. Whoever buys it can then apply for the rights shares at the offer price.
If you neither subscribe nor renounce within the deadline, your entitlement lapses automatically and the shares are disposed of as per the company’s discretion.
Easy & quick
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