The IPO also comes with 1 warrant for every 2 shares.
These warrants can be converted to equity shares at 25% premium to IPO price after 16 months.
This would mean a conversion price of Rs 187.5. If Renaissance Jewellery lists above Rs 187.5, the warrant will also have a positive intrinsic value. The warrants will be listed too and can be sold off separately.
(A warrant is like a long-term call option of Rs 187.5 strike price).
If the warrants are converted to shares after 16 months, the number of shares outstanding will be 21021560 (2.1 crore shares).
I have been alloted 64 shares and 32 warrants. What does the Warrants mean? What am I supposed do with that. Any info on this will be much appreciated.
Congratulations ! You have been allotted 45 shares of Renaissance Jewellery Limited against your application for 90 shares. Your DP account has been credited with above shares. Rs 6750 is being credited through ECS in to your bank.
Kindly note that file containing refund data for credit to your bank account through ECS channel has been handed over to Refund Banker (HDFC Bank). Credit into respective account through ECS can be expected in Mumbai by 08/12/2007 and other than Mumbai by 12/12/2007. Hence, if the credit is delayed beyond 6 days, you may follow up with your banker for the same.
Please note that you should transact in this security only after verifying the credit of the security in your DP account.