Tata Motors on Tuesday said TML Securities Trust, has sold 1.14 crore new ordinary shares (NOS) on the exchanges today for distribution of fractional share entitlement as well as towards tax liabilities.
Earlier, the auto major received clearance from the National Company Law Tribunal (NCLT) for its scheme of arrangement which involves reducing share capital by cancelling 'A' Ordinary shares and issuing new ones as compensation.
Recently, the company canceled the DVR shares and had planned to replace them with ordinary shares. Under the scheme, for every 10 DVR shares, investors will receive 7 ordinary shares.
Axis Trustee Services, an Independent Trustee, will now proceed to distribute sale proceeds in cash to the eligible ‘A’ ordinary shareholders and credit the balance NOS as per entitlement to their respective demat accounts, shortly.
The company will intimate the ‘A’ ordinary shareholders individually as well as to the stock exchanges upon the distribution of cash as well as credit of NOS.
Tata Motors DVR shares are a unique type of equity that offers differential voting rights. These shares were introduced to enable the company to raise capital while preserving the voting power of existing shareholders.
DVR shares offer fewer voting rights compared to ordinary shares—typically, each DVR share carries one-tenth the voting power of an ordinary share.
To compensate for this reduced voting power, DVR shares generally offer a higher dividend than ordinary shares, making them an attractive option for investors seeking income rather than control over the company.
Following the announcement, Tata Motors shares fell over 2% in afternoon trade on Tuesday at Rs 965.7 on NSE. So far this year, the stock has rallied around 22%.
Recently, global brokerage firm UBS pressed a 'sell' rating on the stock, with a target price of Rs 825, due to a weaker growth outlook for the company after it cut the prices on its EVs and popular cars.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Earlier, the auto major received clearance from the National Company Law Tribunal (NCLT) for its scheme of arrangement which involves reducing share capital by cancelling 'A' Ordinary shares and issuing new ones as compensation.
Recently, the company canceled the DVR shares and had planned to replace them with ordinary shares. Under the scheme, for every 10 DVR shares, investors will receive 7 ordinary shares.
Axis Trustee Services, an Independent Trustee, will now proceed to distribute sale proceeds in cash to the eligible ‘A’ ordinary shareholders and credit the balance NOS as per entitlement to their respective demat accounts, shortly.
The company will intimate the ‘A’ ordinary shareholders individually as well as to the stock exchanges upon the distribution of cash as well as credit of NOS.
Tata Motors DVR shares are a unique type of equity that offers differential voting rights. These shares were introduced to enable the company to raise capital while preserving the voting power of existing shareholders.
DVR shares offer fewer voting rights compared to ordinary shares—typically, each DVR share carries one-tenth the voting power of an ordinary share.
To compensate for this reduced voting power, DVR shares generally offer a higher dividend than ordinary shares, making them an attractive option for investors seeking income rather than control over the company.
Following the announcement, Tata Motors shares fell over 2% in afternoon trade on Tuesday at Rs 965.7 on NSE. So far this year, the stock has rallied around 22%.
Recently, global brokerage firm UBS pressed a 'sell' rating on the stock, with a target price of Rs 825, due to a weaker growth outlook for the company after it cut the prices on its EVs and popular cars.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
