Finance is the basic requirement of any business. Management of the finances of a new or pre-established industry is an essential function of an entrepreneur. In the absence of finance, any new plan or expansion of the enterprise cannot be possible. Economists divided the sources of finance management into ownership capital and debt capital. For a new approach, a new strategy, the financial sources supporting the Indian capital market can be classified as follows

Purchasing Of Debentures & Shares-

Any industrial unit issues shares and debentures to obtain fixed capital. A new idea, a new strategy can raise funds for the purchase of shares and debentures for any employment group.

Classification Of Debentures & Shares:

Equity Share- Equity shares are the pillars of the financial structure of the firm. The dividend is paid to the holders of these shares after the preference shareholders. In case of winding up of the company, the capital is returned to the equity shareholders after the preference shareholders. Being the owner of the company, they have the right to attend and vote in the general meeting of the shareholders.

Preference Share- Preference shareholders are paid dividend at a fixed rate and in case of liquidation of the company, they have the right to receive capital before equity shareholders, but such shareholders do not have the right to participate in the general meeting, nor Has the right to exercise the franchise. There are main types of preference shares:

1. Cumulative preference shares
2. Non-cumulative preference shares
3. Redeemable preference share
4. Irredeemable preference share
5. Convertible preference shares
6. Non Convertible preference shares
7. Participating preference shares
8. Non-participating preference shares

Debentures- Apart from shares, another important means of obtaining industrial capital is the issue of debentures. Debentures can be of both secured and reserved types. The debenture holder is the creditor of the company and as such the liability for their repayment is on the company. A fixed rate of interest is paid on the debentures till they are redeemed.

Debenture-cum-equity- These debentures are fully convertible. As per the wishes of the debenture holders and as per the rules of debenture issue, these debentures can be fully redeemed or such debentures can also be converted into equity shares. Hence such debentures are called debenture-cum-equity.

Other Securities- Apart from the above, funds can also be obtained through different types of securities.

Example- Stocks, Bonds, Mutual Funds, etc.

Any entrepreneur or employment group will get a new source of income after following a new thinking, a new strategy. Through which that entrepreneur or employment group can invest in the Indian capital market. As a result of this pursuit, the industrial units of the nation will get help in collecting more money.

Statutory Note

This whole plan has been carefully prepared under a new thinking, a new strategy. Even after this, if any kind of error and defect is found in the study and analysis of the subject, then no responsibility of any kind will be of the subject creator, blogger website and people related to this subject.