Reliance Industries Limited (RIL) made a blockbuster announcement on Thursday, stating that its board will review a proposal for issuing 1:1 bonus shares on September 5. Following the news, RIL's stock witnessed an immediate surge of 2.63 percent on the BSE and reached an all-time high of Rs 3,074. Similarly, it climbed 2.58 percent on the NSE. This positive development also skyrocketed the company's market capitalisation by a massive Rs 42,399.24 crore. Mukesh Ambani, during his speech at RIL's annual shareholder meeting, emphasized the company's focus on generating long-term wealth for the nation and leveraging technology to solve complex human challenges.
Reliance Industries' 1:1 Bonus Share Issuance: A Windfall for Investors
Background:
Reliance Industries Limited (RIL), India's largest private sector company, has announced a proposal to issue 1:1 bonus shares to its shareholders, subject to regulatory approval. The announcement on August 22, 2023, sent RIL's share price soaring to an all-time high.
Key Details:
Impact on Share Price and Market Capitalization:
The announcement of the bonus share issuance has been met with enthusiasm by investors, leading to a surge in RIL's share price. On the day of the announcement, the stock rose by 2.63% on the BSE and 2.58% on the NSE. The company's market capitalization also surged by a significant Rs 42,399.24 crore.
Rationale for the Issuance:
RIL's decision to issue bonus shares is seen as a reward to its long-term shareholders and a reflection of the company's strong financial position. According to company officials, the move is intended to enhance shareholder value and provide investors with an additional opportunity to participate in the company's growth journey.
Top 5 FAQs and Answers:
When is the record date for the bonus share issuance? Answer: The record date will be announced after the proposal is approved by the company's board.
How many bonus shares will I receive if I hold 100 shares of RIL? Answer: You will receive 100 bonus shares.
What is the impact of the bonus share issuance on my shareholding? Answer: Your shareholding will double as you will receive an equal number of bonus shares as your existing shares.
What is the tax treatment of bonus shares? Answer: Bonus shares are generally tax-free in the hands of the recipient.
Has RIL issued bonus shares in the past? Answer: Yes, RIL has issued bonus shares in the past, including a 1:1 bonus share issuance in 2017.
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