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shareholder in a company.
A share is defined as, a share in the share
capital of the company and includes stock
Share
Kinds Of Shares
Preference shares &
Equity shares
Equity Shares
Equity share are also called
common
stock/share
or
ordinary
shares, investment in share. Equity
shares are considered to be mere risky
than both bonds and preference
shares.
They, however, afford greater
advantage than both the other
securities and in the capital market
enjoy a better position as for as the
investor attraction is concerned.
Characteristics Of Equity
Shares
Voting rights.
Ownership rights.
Par value.
Right shares.
Tax benefits.
Voting rights
A specific right of voting
the members owning equity
shares to receive the notice.
Right to be elected from the
members of the executive
committee become the
director of the company on
purchasing shares.
Ownership rights
The equity share holders are
Par Value
An equity share has a
face value or par value. Equity
share may also be sold or
issued at a premium or at a
discount but the face value will
be denomination. It shows the
liability of an investor.
Right shares
The share holders has a
right of receiving additional
shares whenever they were
issued by the company.
Tax Benefits
Up to Rs.7000 interest can be deducted
under section 80 to calculate the total income
of a person.
But sometimes when the company is new, the
investor can benefit of his holding in equity
stock of new firms under section 80.
Income in the form of dividends in the new
undertakings is deductible before paying the
tax for the first 5 years of the existence.
Preference Share
Preference share
Preference shares capital is the sum
preference shares
Participating & NonParticipating preference
shares.
Redeemable & NonRedeemable preference shares
Convertible & Non-convertible
preference shares
Non-cumulative preference
share
Redeemable preference
share
Shares which can be
purchased back by the
company are called
redeemable preference share.
The company reserves its right
to call back or purchase shares
at any time subject to the
articles of association.
Non-Redeemable preference
shares
These shares cannot
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