Interested to Buy Any Domain ? << Click Here >> for more details...
Recently while appraising a loan proposal I noticed that the
company was a newly formed company. While allotting the
capital among the share holders the shares were allotted at
a huge premium. What is the reason for showing a huge premium?
- 3 Answers
- 7275 Views
- I also Faced
- E-Mail Answers
Answers were Sorted based on User's Feedback
Answer / ajay
Issuing the shares at premiums is a matter of great
concern. if a share is issued at premium it may reflect
various things like wise.
-Market Requirement of Product or services.
-Quality of prod. or services
-Market Capitalization of pro. & ser.
-board competency
-Brand loyality
etc.
As the rate of above goes higher, the result is high rate
of preimium and vice-e-versa.
considering the same there may a practical scenario, take a
private company for eg.-
-Authorised capital - Rs 50.00 lacs (50,000 equity of Rs.
100 each.)
-Share issued and subscribed 20,000 shares @ Rs.425
(including premium of Rs. 325.to person other than promoters
-Shares issued otherwise than for cash to the Promotrs is
29,000
Shares subscribed by promoters as asubscriber to memorandum
is 1,000 equity.
NOW UNDERSTAND THE CAPITAL AND CONTROLLING STRUCTURE OF THE
CO.-
PROMOTERS INVOLVEMENT IN CAPITAL IN CASH OR OTHERWISE-
EQUITY (in no.)- 30,000 or 60% voting power i.e control in
hand
VALUE PAID FOR THE SHARES- 30.00 LACS (1.00 LACS IN CASH
AND OTHER 29.00 LACS IN KIND)
OTHERS INVOLVEMENT IN CASH-
EQUITY- 20,000 OR 40% voting power.
VALUE PAID FOR THE SHARES-Rs. 85.00 lacs (including premium
amount of Rs. 65.00 lacs)
Let's check the Banks position-
There is Rs. 86.00 lacs in the co.(s) banks account outof
which only Rs. 1.00 lacs is promoters contribution.
This all happend due to TTHE CORPORATE, MANAGEMENT, BRAND,
PRODUCT OR SEVICE STANDARD OF THE CO. WHICH ULTIMATLY
MOTIVATES THE CORPORATES TO ISSUE THE SHARES ART PREMIUM.
| Is This Answer Correct ? | 1 Yes | 0 No |
Answer / reena
The Company might be opening with a huge project and for
that purpose the Company might require huge capital . As
the Company wants to issue less capital (number of shares),
it might be issuing the shares at a premium for raising teh
funds.
| Is This Answer Correct ? | 1 Yes | 2 No |
DIFFERENCE BETWEEN EQUITY SHARE CAPITAL & PREFERENCIAL SHAR CAPITAL
what is derivatives?
is cs equivalent to post graduation course?
What is the percentage rate of PF,ESI,PROFESSION TAX,SERVICE TAX,VAT,INCOME TAX in BANGALORE?
What you mean by blue chip companies?
My Question is how do we distribute profit in pvt ltd, btwn directors and share holders...the pvt ltd is unregistered.
what is credit managment & quqlity managment
what is the procedure to start any company? who will fix this share value?how to go for pulic issue?
how to start a personal finance company that is not require RBI registration.
what are all the things to be checked while consolidation of project/site accounts?
I am forming a Pvt. Ltd. company with total 4 no. of directors including myself. I'll be providing all the financing via. initial capital investment + operating cost. We have mutually agreed to keep percentage as - 55% myself and 15% each of other 3 (15x3=45%) now my questions are : 1. What if one person backs out at any given point, what are implications and what would happen to his share of percentage ? 2. What should I do to keep a control on decisions and financial matters in case any of the directors cheats/wants to leave? (as my money will be on stake)
i have cleared c.s inter. for the purpose of training i want to know the companies who are providing training of c.s in punjab state.please help me in this.
Audit 
