5.2 Raising of share capital

5.2 RAISING OF SHARE CAPITAL

Raising share capital refers to the process of increasing the funds available to a company by issuing new shares to investors. It is a common method used by companies to raise funds for various purposes, such as expansion, acquisitions, debt repayment, or working capital.

Ways in which companies can raise share capital:

1. Public Issue/Initial Public Offering (IPO):

A company can raise share capital by making an initial public offering (IPO) and listing its shares on

2. Rights Issue:

A rights issue allows existing shareholders of a company to purchase additional shares in proportion to their existing shareholdings.

3. Private Placement:

A private placement involves offering shares to a select group of institutional or accredited investors, rather than to the general public.

4. Venture Capital and Private Equity:

Companies in their early stages or high-growth phases may raise share capital through venture capital (VC) or private equity (PE) investments.

5. Crowdfunding:Crowdfunding platforms allow companies to raise share capital by soliciting investments from a large number of individuals, often through online platforms.
   6. Convertible Debt:

   Companies may raise share capital by issuing convertible debt instruments, such as convertible bonds or convertible notes.