Sports production, promotion and management firm Toyam Sports Limited has announced a fundraising plan to the tune of Rs 50 crore through the rights issue.

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A rights issue is also a type of corporate event that allows a company's existing shareholders to purchase extra shares in proportion to their existing holdings at a discount price. A rights issue is a way for companies to raise additional funds from their existing shareholders. It is also an opportunity for existing shareholders to increase their exposure to the stock at a discount price.

As per Section 73 of the Companies Act 1956, if a company does not receive the minimum subscription of 90 per cent of the issued amount on the date of closure of the issue, or if the subscription level falls below 90 per cent after the closure of the issue, the issuer should forthwith refund the entire subscription amount received.

Also, if there is a delay beyond 8 days after the company becomes liable to pay the amount, the company shall pay interest, as per the rule.

The small-cap company which is engaged in the other financial services industry, has said that a rights issue committee will be constituted to proceed with the rights issue.

 "In terms of Regulation 30 of the SEBI, the Board of Directors approved fundraising for an aggregate amount not exceeding Rs 50 crore through issuing partly paid-up equity shares by way of rights issue to the eligible equity shareholders as on record date (to be notified subsequently within due course)," it said in a statement.

The rights issue is in accordance with applicable laws, including the Securities and Exchange Board of India Regulations, 2018.

Apart from this, the firm has also announced to increase its authorised capital to Rs 110 crore.