Table of Contents
Bonus
| COMPANY | Bonus Ratio | DATE |
|---|---|---|
| Mittal Life Sty | 1:10 | 27-07-2021 |
| Swasti Vinayaka | 2:7 | 29-06-2021 |
| Redington | 1:1 | 07-07-2021 |
| Brightcom Group | 1:4 | 28-06-2021 |
Which companies are expected to issue bonus shares in the future?
Bonus
| COMPANY | Bonus Ratio | DATE |
|---|---|---|
| IEX | 2:1 | 06-12-2021 |
| Apollo Pipes | 2:1 | 04-12-2021 |
| NCL Research | 1:1 | 03-12-2021 |
| Indo US Bio-Tec | 1:5 | 30-11-2021 |
The bonus shares will be issued to “eligible members of the company in the proportion of two new fully paid-up equity share of rupee one each for every one existing fully paid-up equity shares of rupee one each held by them, by capitalising a sum not exceeding Rs 59,91,13,022 out of the company’s free reserves and …
When company issues bonus shares its share price?
Because issuing bonus shares increases the issued share capital of the company, the company is perceived as being bigger than it really is, making it more attractive to investors. In addition, increasing the number of outstanding shares decreases the stock price, making the stock more affordable for retail investors.
By issuing bonus shares, the number of outstanding shares increases, but each share’s value reduces, as shown in the example above. The face value remains unchanged.
Why do companies issue bonus shares?
If the share price of a company becomes much higher, issuing bonus shares reduces the price per share while retaining the company’s capital structure. Thus it gets attention from small investors who otherwise would face difficulty in buying shares of that particular company. Important Dates to Remember:
Ex-Bonus Date:It is a pre-determined date after the record date on which the share price is adjusted on stock exchanges according to the bonus ratio. How to Calculate the Number of Bonus Shares? Suppose you own a total of 200 shares of Company X at a current market price of $150 per share.
What is the difference between stock split and bonus issue?
See our guide on the difference between stock split and bonus issue. Companies usually issue bonus shares to encourage retail participation and increase their equity base. If the share price of a company becomes much higher, issuing bonus shares reduces the price per share while retaining the company’s capital structure.
Paying abnormally high rate of dividend can be replaced by issuing bonus shares. The balance sheet of the company will bring out a more truthful picture of the capital structure and the capacity of the company.