Chapters in IPOs & Primary Market
Chapter 5 of 5 · 6 min read
Bonds, rights issues, buybacks and OFS
The other ways companies raise or return capital, and what each means for you.
Debentures and bonds
Companies issue debentures or bonds to borrow from investors for a fixed term at a stated coupon. Credit rating matters: it estimates the chance the issuer pays on time.
Rights issue
Existing shareholders are offered new shares, usually at a discount, in proportion to holdings. You can subscribe, sell the entitlement or let it lapse (which dilutes your stake).
Buyback
The company buys its own shares, often at a premium, shrinking the share count. Acceptance ratio decides how many of your tendered shares are bought. Tender-route buybacks have specific record dates.
Offer for sale (OFS)
Promoters sell stock through a special exchange window, often to meet minimum public shareholding rules. Price is usually at a discount to market.
Key takeaways
- Bonds pay interest; check the rating and tenure.
- Rights dilute you if ignored; buybacks may add a premium.
- Always check record dates and entitlement ratios.
Put it into practice
Open the live page on Market Intelligence and see this concept on real data.
Keep learning
- Credit ratings, upgrades and default watch · Institutional Flows, Ownership & Risk
Education only, not investment advice. Updated 2026-10-09.