CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,    Chennai - 600 004. Tel: +91 - 44 - 249...
INTRODUCTION         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,                                 • A sh...
EQUITY SHARES         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,               • Equ...
DEFINITION OF EQUITY                                             SHARES         CHENNAI3rd Floor, ‘Creative Enclave’,148-1...
FEATURES OF EQUITY                                           SHARES         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, ...
CONT.         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,    Chennai - 600 004.      ...
TYPES OF EQUITY SHARES         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,                             ...
CONT.         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,    Chennai - 600 004.      ...
CONT.         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,                            ...
CONT.         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,                            ...
CONT.         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,    Chennai - 600 004.      ...
LIMITATIONS AND RISK                                           FACTORS         CHENNAI3rd Floor, ‘Creative Enclave’,148-15...
CONT..         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,                                 • The rate o...
CONCLUSION         CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,    Chennai - 600 004. ...
CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road,         Mylapore,    Chennai - 600 004. Tel: +91 - 44 - 249...
Upcoming SlideShare
Loading in...5
×

Types of equity shares

19,645
-1

Published on

Published in: Business, Economy & Finance
1 Comment
8 Likes
Statistics
Notes
  • difference between equity shares and preference shares should also be given .
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
No Downloads
Views
Total Views
19,645
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
523
Comments
1
Likes
8
Embeds 0
No embeds

No notes for slide
  • © Altacit Global 2009 Email: info@altacit.com
  • Types of equity shares

    1. 1. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 TYPES OF EQUITY BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 SHARES SHELLEY E. EMAIL Trademark Department info@altacit.com WEBSITE www.altacit.com
    2. 2. INTRODUCTION CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • A share is a document which is issued by a company, Mylapore, Chennai - 600 004. registered with the stock exchange, by which the holder of Tel: +91 - 44 - 2498 4821 the share becomes one of the owners of the company. BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. • There are several different stock types and classifications, so Tel: +91 - 80 - 6546 2400 it is important to understand what type your shares are and COIMBATORE BB1, Park Avenue, # 48, Race Course Road, what their classifications are. Coimbatore - 641018. Tel: +91 - 422 – 6552921 • Two of the biggest stock types are preferred stock shares and common stock shares/ Equity Shares. • These type of shares you own will determine how you are EMAIL paid, and the value of your stock if the company goes info@altacit.com under, as well as the order debts are paid to shareholders. WEBSITE www.altacit.com
    3. 3. EQUITY SHARES CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, • Equity shares/common shares/ordinary shares. Chennai - 600 004. Tel: +91 - 44 - 2498 4821 – These shares are the most commonly traded shares, and BANGALORE Suite 920, Level 9, they give you a vote in company matters. Raheja Towers, 26-27, M G Road, Bangalore - 560 001. – Equity shares can be purchased from the stock market or Tel: +91 - 80 - 6546 2400 from the company when it announces public issue of its COIMBATORE BB1, Park Avenue, stock. # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 – They earn a dividend as long as the company is earning money, and this dividend directly corresponds to the profit made by the company. – High profits mean high dividends for you. – Ordinary shares have no special rights or restrictions. EMAIL – Whilst they have the highest risk, they also have the info@altacit.com potential to bring the biggest financial gains. WEBSITE www.altacit.com
    4. 4. DEFINITION OF EQUITY SHARES CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, • Equity is the extra or surplus of profit left over to be Chennai - 600 004. Tel: +91 - 44 - 2498 4821 distributed between investors, after all the liabilities are BANGALORE paid off. Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 • According to section 85 (2), of Companies Act, 1956, COIMBATORE Equity share can be defined as the share, which is not BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. preference shares. In other words equity shares are those Tel: +91 - 422 – 6552921 shares, which do not have the following preferential rights: – (a) Preference of dividend over others. – (b) Preference for repayment of capital over others at the time of winding up of the company. EMAIL info@altacit.com WEBSITE www.altacit.com
    5. 5. FEATURES OF EQUITY SHARES CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. • It is a financial instrument through which it bestows Tel: +91 - 44 - 2498 4821 ownership rights to the investor in the company. BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. • The owner has a right on the profits and on the Tel: +91 - 80 - 6546 2400 company’s assets in case of liquidation of the company. COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. • They have voting rights in the company. Tel: +91 - 422 – 6552921 • They are distributed the surplus of profits after the interest is settled, taxes paid and depreciation provided and preference shareholders are cleared. EMAIL info@altacit.com WEBSITE www.altacit.com
    6. 6. CONT. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. • The financial standing, its progress and strategies for Tel: +91 - 44 - 2498 4821 BANGALORE growth of the company determines the share prices. Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. • These equity shares can be bought at the stock Tel: +91 - 80 - 6546 2400 COIMBATORE exchange, through stock brokers, online brokers and BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. sometimes in banks and Tel: +91 - 422 – 6552921 • Though the creditors and preferential shareholders invest cash, they have no say in the conduct of business while the equity shareholders have full powers to direct the company. EMAIL info@altacit.com WEBSITE www.altacit.com
    7. 7. TYPES OF EQUITY SHARES CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • Blue Chip Shares: Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 – These are the shares of companies which are well BANGALORE established and reputed in all fields. Suite 920, Level 9, Raheja Towers, 26-27, M G Road, – These shares normally pay dividends, and have a track Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 record of performance and earnings. COIMBATORE – Blue chip companies also have no large amounts of BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. liabilities. Blue chip shares are usually the cream of the Tel: +91 - 422 – 6552921 crop, and are sought after. These types of shares are generally considered stable and safe as an investment. The Blue Chip companies include Microsoft, Coca- Cola, Reliance, ONGC, NTPC, SBI, ICICI, Tata Steels, EMAIL Wipro, and a few others. info@altacit.com WEBSITE www.altacit.com
    8. 8. CONT. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. • Penny stocks: – These are another shares classification, and these Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, shares are low in price and high in risks. 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 – Penny shares are not traded on the regular stock COIMBATORE markets and exchanges, and are instead traded on BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. over the counter markets instead. Tel: +91 - 422 – 6552921 – Penny shares offer a significant opportunity for reward if you choose wisely, but there is a high risk level involved because many penny shares come from companies without an extensive history available. EMAIL info@altacit.com WEBSITE www.altacit.com
    9. 9. CONT. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, • Income Shares: Chennai - 600 004. Tel: +91 - 44 - 2498 4821 – These companies have a stable share value and always BANGALORE Suite 920, Level 9, pay high dividends. Raheja Towers, 26-27, M G Road, Bangalore - 560 001. – Since they have high dividend payout ratio, the profits Tel: +91 - 80 - 6546 2400 of the company saved are less and so their growth COIMBATORE BB1, Park Avenue, opportunities are very less. # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 • Growth Shares: – These are shares of companies which are on top in their industry like Wipro in Computers, Tatas in steel, Bajaj in automobiles etc. EMAIL – The shares here have less dividend payout and so their info@altacit.com growth rate is high. WEBSITE www.altacit.com
    10. 10. CONT. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, • Cyclical Shares: Chennai - 600 004. Tel: +91 - 44 - 2498 4821 – Some company’s performance keeps BANGALORE Suite 920, Level 9, Raheja Towers, fluctuating like a business cycle meaning the 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 share prices are affected with any variations in COIMBATORE the economy. BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. – Sugar and fertiliser are two such industries. Tel: +91 - 422 – 6552921 • Defensive Shares: – The shares of these companies are not affected by the economical changes. EMAIL info@altacit.com WEBSITE www.altacit.com
    11. 11. CONT. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. • Speculative Shares: Tel: +91 - 44 - 2498 4821 – The shares here are traded on speculations. These shares BANGALORE Suite 920, Level 9, Raheja Towers, are high risk in nature but also give very high returns in 26-27, M G Road, Bangalore - 560 001. short terms. Tel: +91 - 80 - 6546 2400 – The scrips fall sharply suddenly so investors should COIMBATORE BB1, Park Avenue, # 48, Race Course Road, always keep an eye on it always. Coimbatore - 641018. Tel: +91 - 422 – 6552921 • Value shares: – are shares which investors believe have been undervalued, and these shares are believed to be worth more than the current market value. EMAIL info@altacit.com WEBSITE www.altacit.com
    12. 12. LIMITATIONS AND RISK FACTORS CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 • The equity share holders have many limitations as far as BANGALORE income is concerned. Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 • Even when there are profits, they get their share at the COIMBATORE last which means the amount of sharing gets reduced. BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 • The preferential shareholders and creditors are paid interest income even if the company is in loss but the equity shareholders get their share only if company makes huge profits. EMAIL info@altacit.com WEBSITE www.altacit.com
    13. 13. CONT.. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • The rate of dividend on such shares is not pre- Mylapore, Chennai - 600 004. determined, but it depends on the profit earned by the Tel: +91 - 44 - 2498 4821 company. BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. • These shares are also known as ‘Risk Capital’, because Tel: +91 - 80 - 6546 2400 they get dividend on the balance of profit if any, left COIMBATORE BB1, Park Avenue, # 48, Race Course Road, after payment of dividend on preference shares and also Coimbatore - 641018. Tel: +91 - 422 – 6552921 at the time of winding up of the company, they are paid from the balance asset left after payment of other liabilities and preference share capital. • They have to claim dividend only, if the company in its EMAIL A. G. M. declares the dividend. info@altacit.com WEBSITE www.altacit.com
    14. 14. CONCLUSION CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 • The shares cannot be put in one category as each BANGALORE has different characters and are overlapping each Suite 920, Level 9, Raheja Towers, 26-27, M G Road, other. The investment in shares involve market Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 risks. Hence a very careful analysis in choosing the COIMBATORE BB1, Park Avenue, # 48, Race Course Road, right share is important. Coimbatore - 641018. Tel: +91 - 422 – 6552921 EMAIL info@altacit.com WEBSITE www.altacit.com
    15. 15. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, THANK YOU 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 EMAIL info@altacit.com WEBSITE www.altacit.com
    1. A particular slide catching your eye?

      Clipping is a handy way to collect important slides you want to go back to later.

    ×