Esop in India

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Equity is being issued to Whole Time Directors, Officers and Employees of the Company through different stock-based plans. These plans are being offered to employees of a company, with a right but not a obligation, to buy or opt i.e., option to buy or opt a fixed number of shares of the company at a stated price during a specified period, often at a discount from the market price at the date of grant. The options under a plan vests over a period to an employee subject to fulfillment of certain employment related conditions e.g. continued employment for a specified period. In the case of performance-based plan, the employees have to meet specified goals in addition before vesting can occur. Often companies will require the …show more content…

3.Research Methodology
Title of the Study
Employee participation through equity in the company. Introduction
Employee Stock Option Scheme means the option given to the Whole Time Directors, Officers and Employees of the Company which gives them a right or benefit to purchase or subscribe the securities offered by the Company at a predetermined price at a future date. The idea behind sock option is to motivate the employees by linking the profitability of the Company. A stock option gives an employee the right to buy a certain number of shares in the company at a fixed price for a certain number of years. The price at which the option is provided is called the "grant" price and is usually the market price at the time the options are granted. Employees who have been granted stock options hope that the share price will go up and that they will be able to "cash in" by exercising (purchasing) the stock at the lower grant price and then selling the stock at the current market price.
Significance of the Study
Traditionally, stock option plans have been used as a way for companies to reward top management and "key" employees and link their interests with those of the company and other shareholders. More and more companies, however, now consider all of their employees as "key."
Hence it is worth studying how the employee stock option plan is useful for the employees and what are the various benefits gained by them.
Objectives of the Study * To

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