Equity share example sentences

For example, as equity share holders enjoy voting rights, financial institutions may take control of the assets or impose conditions as part of the loan agreement.In this context, earnings refer to profit available for equity shareholders which is worked out as Profit after Tax Dividend on Preference Shares.Debentures which are convertible into equity shares or in any other security either at the option of the company or the debentureholders are called convertible debentures.This ratio is again very important from equity shareholders point of view as it gives an idea about the value of their holding and affects market price of the shares.Debentures which are convertible into equity shares or in any other security either at the option of the company or the debentureholders are called convertible debentures.Democratic control over management of the company is assured due to voting rights of equity shareholders.That it carries a preferential right to dividend to be paid either as a fixed amount payable to preference shareholders or an amount calculated by a fixed rate of the nominal value of each share before any dividend is paid to the equity shareholders.Equity shares are suitable for investors who are willing to assume risk for higher returns; Payment of dividend to the equity shareholders is not compulsory.The dividend on equity shares is not fixed and it may vary from year to year depending upon the amount of profits available for distribution.The issue of debentures is suitable in the situation when the sales and earnings are relatively stable; As debentures do not carry voting rights, financing through debentures does not dilute control of equity shareholders on management; Financing through debentures is less costly as compared to cost of preference or equity capital as the interest payment on debentures is tax deductible.Issue of equity shares and retained earnings are the two important sources from where owner's funds can be obtained.In other words, as compared to the equity shareholders, the preference shareholders have a preferential claim over dividend and repayment of capital.Debentures which are convertible into equity shares or in any other security either at the option of the company or the debentureholders are called convertible debentures.More formalities and procedural delays are involved while raising funds through issue of equity share.Due to their fluctuating earnings, equity shareholders are called risk bearers of the company.