The situation
An issuer sells 1.5 crore new shares at ₹120 and existing holders sell 0.5 crore shares at the same price. Issuer-paid costs are ₹8 crore.
Your task
How much cash goes to the company and selling holders?
Reveal step-by-step solution
Set up the problem
Fresh issue = 1.5 crore × ₹120 = ₹180 crore gross. Offer for sale = 0.5 crore × ₹120 = ₹60 crore gross.
Work through the numbers
Company net proceeds = ₹180 − ₹8 = ₹172 crore.
Interpret the result
Total gross offer is ₹240 crore. Selling holders receive ₹60 crore before any costs they bear.
What to remember
Split fresh issue and secondary sale before calculating issuer proceeds or share dilution.