Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Bonus issue is a corporate action where a company issues additional free shares to existing shareholders proportional to their holdings.
A bonus issue gives you free extra shares — like a 1:1 bonus doubles your shares without you paying anything.
Bonus shares are issued from reserves (capitalisation of profits). Face value may adjust, but total market value remains unchanged immediately after announcement-adjusted price. Cost basis per share reduces proportionally for tax purposes.
You hold 100 shares of a company declaring 1:2 bonus. You receive 50 additional shares free. If price was ₹600, ex-bonus price adjusts to roughly ₹400 — total value stays ₹60,000.
No. Dividends pay cash; bonus issues give additional shares by capitalising reserves. Both reward shareholders differently.
Receipt of bonus shares is not taxed immediately. Capital gains apply when you sell, with acquisition cost calculated per IT rules for bonus shares.
To reward shareholders, improve liquidity by lowering share price, and signal confidence without cash outflow.