Tata Motors Share Price; DVR buyers get double benefits for less money, know detailed details
What is DVR?
DVR Shares means Differential Voting Rights Shares. These are shares which have different rules regarding voting and dividends. As per the de facto general rules every shareholder of the company gets equal voting rights and dividend rights. Such shares are called common or common shares. Meanwhile, the concept of DVR was introduced. In this, companies issue certain shares that have less voting rights than ordinary shares. In return the companies pay higher dividends to DVR investors than to common shareholders.
Simply put, investors who want maximum returns from the company and do not participate in voting on the company’s management decisions, companies reduce their voting rights by paying more in the form of additional dividends. This benefits both the company and the investor.
What’s special about DVRs is that DVRs are offered at a much lower price than common shares, so investors can take advantage of the company’s growth with less money. Tata Motors launched the first DVR in India in 2008. After that Gujarat NRE Coke, Future Enterprises and Jain Irrigation launched their DVRs.
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Tata Motors and Tata Motors DVR
Investors who put money in Tata Motors DVR instead of Tata Motors shares get 5% additional dividend. Shares of Tata Motors have gained around 47% in the last one year and 89% in the last 5 years, while DVR has gained 71% in one year and 74% in five years. So it can be said that the return of Tata Motors DVR in last one year is much better than Tata Motors common stock.
