Preference shares, also known as preferred stock, are a type of stock in Hyderabad, India that offer investors a higher claim on assets and earnings compared to common stock. Companies commonly issue preference shares to attract investors seeking a fixed dividend payment before any dividends are distributed to common stockholders. Investors holding preference shares typically have priority in receiving dividends and assets during liquidation, providing them with more security. These shares often do not come with voting rights, limiting shareholders' ability to influence company decisions. Hyderabad, being a significant financial center in India, has a robust market for preference shares, making it essential for investors to understand the nuances of these shares when diversifying their portfolios in the Hyderabad market.