What is Warrants with Example?

Warrants Meaning in Finance 

Warrants operate like a trade where a company offers you a part of its ownership, and in return, you provide them with funds to aid their expansion. You usually have the choice to pay 25% upfront and the remaining 75% within about a year and a half, although this is not obligatory. These warrants are often provided at a price below the current value of shares. They are commonly issued to promoters.

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For Example: On May 25, 2023, the Board of Directors (BoD) of Zen Technologies Ltd approved the conversion of convertible warrants into 4.7 lakh equity shares for the Promoters. These warrants were initially allotted in November 2021 at a rate of INR 213 per warrant. The Promoters will pay INR 7.5 crore, which corresponds to 75% of the initial warrant price.

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Here’s the snapshot of allotees belonging to Promoter category: