Preferred vs common shares in Uzbekistan

Many companies on the Republican Stock Exchange «Toshkent» (UZSE) have two tickers: one for common shares and one ending in P for preferred shares, such as UZTL and UZTLP for Uzbektelecom or HMKB and HMKBP for Hamkorbank. They belong to the same company, but they carry different rights, often trade at different prices and can have very different trading activity. This guide explains the differences as the Law on joint-stock companies and protection of shareholders' rights sets them out, and what they mean for an investor.

All legal points below come from that law as published on lex.uz (checked on 26 September 2026). A company's own charter fills in many details, so always read the charter and the dividend decisions of the company you are looking at.

The basics in one list

Under the law, shares are registered securities and come in two types, common (in Uzbek, oddiy) and preferred (imtiyozli):

• Common shares are voting shares. They give the right to dividends and to take part in managing the company. Voting at a general meeting follows the rule of one voting share, one vote (with the exception of cumulative voting for the supervisory board).
• Preferred shares give their holders priority in receiving dividends and in getting back the funds invested in the shares if the company is liquidated. As a rule, they carry no vote at the general meeting.
• Same par value. Preferred shares must have the same par (nominal) value as common shares.
• A cap on preferred shares. A company must issue common shares and may issue preferred shares, but the par value of placed preferred shares may not exceed 25% of the company's charter capital.
• No conversion from common to preferred. The law does not allow common shares to be converted into preferred shares. The charter may allow preferred shares to be converted into common shares.

Dividends: who gets paid first

The charter must set the dividend and/or the liquidation value of preferred shares, either as a fixed sum or as a percentage of their par value, or by setting out how they are calculated. When a company pays dividends, the law says preferred dividends are paid first and common dividends second. If the company has enough profit to pay the fixed preferred dividend, it may not refuse to pay it, and holders can claim it in court.

Other points from the law:

• Dividends are paid from the company's net profit and/or retained earnings from past years. Preferred dividends can also be paid from funds set aside for that purpose.
• Dividends on preferred shares may not be paid in securities.
• The charter may say that an unpaid or partly paid preferred dividend accumulates and is paid later (a cumulative dividend).
• Common dividends are not fixed. They depend on the general meeting's decision each time.

A worked example

The numbers are illustrative. Suppose a company's charter sets the preferred dividend at 20% of par value, and the par value is 1,000 UZS. Each preferred share is entitled to 200 UZS a year when the company has enough profit to pay it. If the preferred share trades at 1,600 UZS, its dividend yield is 200 ÷ 1,600 = 12.5%.

Now suppose the general meeting decides to pay 150 UZS per common share. The preferred holders receive their 200 UZS first, and the common holders receive 150 UZS. In a very good year, the meeting might pay common shareholders more than the fixed preferred dividend, because the common dividend has no ceiling. In a bad year with too little profit, common holders might receive nothing while preferred holders are paid first. P/E, dividends and dividend yield explains how to calculate and compare yields.

Voting: when preferred shares get a say

Holders of preferred shares normally do not vote, but the law gives them a vote in several cases:

• on reorganisation and liquidation of the company;
• on amendments to the charter that limit their rights, such as changes to the size or order of their dividend or liquidation value;
• from the meeting after an annual general meeting that decided not to pay, or to pay only part of, the preferred dividend. This right lasts until the dividend is first paid in full.

The charter may also give preferred shares a vote if they can be converted into common shares, limited to the number of votes of the common shares they convert into.

If the company is liquidated

When a company is wound up, the law sets the order in which the property left for shareholders is distributed. First come payments for shares the company is obliged to buy back from shareholders who demanded it. Second, accrued but unpaid preferred dividends and the liquidation value of preferred shares set in the charter are paid. Only third is the rest shared among holders of common shares. If there is not enough for all preferred holders, what is available is shared among them in proportion to the number of shares they hold.

What this looks like on UZSE

On UZSE the two classes trade as separate securities with their own ISIN codes and order books. Two examples from the exchange's data for 25 September 2026 (UZTL, HMKB and HMKBP on uzse.uz, as of 25 September 2026):

• Uzbektelecom. 818,339,529 common shares (UZTL) and 29,593,458 preferred shares (UZTLP), both with a par value of 1,154 UZS. The last prices were 17,207 UZS for UZTL and 10,000 UZS for UZTLP.
• Hamkorbank. The common shares (HMKB) closed at 95.5 UZS with 331,811 shares traded that day, and the preferred shares (HMKBP) closed at 105.98 UZS with 15,398 traded.

So a preferred share can trade below the common share of the same company, as at Uzbektelecom, or above it, as at Hamkorbank. The price reflects each class's own dividend terms, the market's view of the company and the trading activity in that class. Preferred classes often trade in smaller volumes, which matters when you want to sell. The exchange also assesses the liquidity of common and preferred shares separately each month. Liquidity risk and thinly traded stocks explains why that matters.

How to choose between the classes

This is not a recommendation, only a list of questions to ask:

1. What does the charter say about the preferred dividend? Look for the fixed amount or percentage, whether it is cumulative and whether conversion is possible.
2. What has the company actually paid? Compare several years of dividends on both classes. Decisions are disclosed on openinfo.uz, and Finmind's public payout calendar lists upcoming dividend payments.
3. Do you care about voting? If influence at the general meeting matters to you, only common shares give it as a rule.
4. How liquid is each class? Check volume and the order book for the exact ticker. Order book, bid, ask and spread shows how.
5. Tax. Under the Tax Code, dividends received by individuals are exempt from personal income tax for the period from 1 April 2022 to 31 December 2028 (lex.uz, article 483, as of 26 September 2026). Check the current text before you rely on it.

Each class has its own public page on Finmind, such as UZTLP and HMKBP, with its latest stored trade and daily closes.

This article is for education only and is not investment advice. Investing in securities involves risk, including the loss of money you invest.