Does delisting mean the company has shut down?

No. Delisting means that the shares of the company will no longer be traded on a stock exchange, even when the company operates. It can generate profits and even declare dividends after delisting.

Will delisted shares automatically get converted into cash?

No. The shares get converted to cash only if you tender them during the official offer of delisting and the promoter accepts the discovered price. Otherwise, the shares remain in your demat account.

Can a delisted company list again in the future?

Yes. A delisted company can relist in the future. However, it must meet the eligibility conditions prescribed by SEBI and follow a fresh process of listing. It can take several years, and the process is not guaranteed.

Are taxes applicable to gains from delisting payouts?

Yes. The cash you received from tendering shares during delisting is treated like a normal equity sale. Therefore, capital gains taxes apply to it, based on the holding period.

Should long-term investors always exit during delisting?

Not necessarily. Liquidity becomes a concern post-delisting. However, investors with strong conviction in the business may choose to hold. Consider your liquidity needs and flexibility of exit while making the decision.