ORDINARY SHARES

Ordinary shares are chosen as a method of equity finance depending on the nature of the business. This funding is usually reserved for projects over Rs3m.

Ordinary shares – also known as common shares – give shareholders voting rights. An ordinary share represents equity ownership in a company, in proportion with all other ordinary shareholders according to their percentage of ownership in the company. Ordinary shareholders participate in dividend payment.

  • No personal guarantee or charges
  • There is no cap on the upside, usually an IRR in the range of 11% p.a to 18% is expected on an investment through ordinary shares.
  • Established a good corporate governance framework

Exit is usually at an expected IRR of 11% to 18%.

  • It helps to increase the capital base without accumulating credit problems.
  • The amount and timing of the dividend payments is flexible.
  • Increase the business liquidity position