India's largest company in terms of market share which is backed by richest man Mukesh Ambani, Reliance Industries (RIL) is coming up with a bonus issue reward for its shareholders. This is the first bonus issue by RIL in seven years, and the third in its history. To be eligible, investors mustn't miss out on important dates.
RIL Share Price:
Due to the bonus issue proposal, Reliance's share price surged nearly 2% to hit an intraday high of Rs 3074.80 apiece on BSE during the trading session of August 29. The stock ended at Rs 3040.85 apiece, up by 1.51% with a market cap of Rs 20,57,382.97 crore.
The stock is near its 52-week high of Rs 3,217.90 apiece. YTD, Reliance stock surged by over 17.4% on BSE, while in a year, the stock rallied 26%. Reliance's all-time gains are about 13,337.25%.
Reliance Industries Bonus Issue:
As per the regulatory filing, a meeting of the Board of Directors of the Company is scheduled to be held on Thursday, September 5, 2024, to consider and recommend to the shareholders for their approval, the issue of bonus shares in the ratio of 1:1 to the Equity Shareholders of the Company by the capitalization of reserves.
The ratio of 1:1 bonus issue means that Reliance will issue one free share on the existing 1 equity share. Simply put, the number of shares in Reliance will double on the ex-bonus date, while the stock price will be adjusted to the ratio.
On the bonus issue proposal, at the 47th AGM, Mukesh Ambani said, shareholders are the backbone of Reliance, and they deserve substantial rewards.
Ambani said, "Our Founder firmly believed that you are the backbone of Reliance and that you deserve a substantial reward from time to time as your company grows from strength to strength. I have supreme confidence in the robust performance and bright future growth prospects of all our businesses."
He said, "When Reliance grows, we reward our shareholders handsomely. And when our shareholders are rewarded handsomely, Reliance grows faster and creates more value. This virtuous cycle has been the guarantor of your company's perpetual progress."
The last time Reliance delivered a bonus issue was in September 2017 in a ratio of 1:1. While its first bonus issue was also of 1:1 that was delivered in November 2009.
How To Be Eligible For Reliance Industries Bonus Issue?
As per Motilal Oswal's blog, in general terms, the eligibility for bonus shares depends on the record date and ex-date of the shareholders.
The record date is a cut-off date set by the company, and the investors must be shareholders of the company before this date for them to be eligible to receive stock bonus share issues.
Besides, the ex-date is also on the same day as the record date due to the T+1 settlement adoption on BSE and NSE.
In India, as per Motilal, the delivery of shares into a Demat account takes place two days after the trading date. All existing shareholders before the ex-date and record date are eligible to receive bonus shares issued by a company. However, to qualify for bonus shares, the company stocks must be bought before the ex-date.
Also, it said, any stocks bought on the ex-date shall not be eligible for an issue of bonus shares as the ownership of the stocks cannot be gained by the investor before the record date.
Reliance will announce the record date for its upcoming bonus issue in due course after receiving approval from board members on September 5, 2024.
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