Right offering refers to the selling of new shares of common stocks to the existing shareholders on pro-rata basis at subscribed price within particular time period instead of selling to new investors. The price at which the stocks are offering is generally lower than that of market price of that stock. It provides right but not obligation to the existing shareholders to buy additional stocks at a discount price. It is more popular way of issuing equity shares as it eliminates the flotation costs and also protects existing shareholders from dilution in controlling power.