Bonus shares are an opportunity for investors to bolster their equity portfolio with additional stocks. Sometimes companies need more funds to issue dividends despite earning good profits. Instead, they announce bonus shares to investors. These shares are issued to existing shareholders without additional costs based on the number of shares held by the investor. In November 2022, several company stocks are going to trade ex-dividend. Let’s find out which companies have announced bonus shares in 2022.
What is a bonus share?
Here is a recapitulation of ‘what is a bonus share?’ before we begin our discussion.
When companies don’t pay dividends, they instead issue bonus shares. These are the company’s accumulated earnings which aren’t paid as dividends but converted into free shares and distributed among investors.
Bonus shares help companies increase their equity base and encourage retail participation. When a company’s share price rises exponentially, it becomes difficult for new investors to buy them. Bonus shares increase the number of shares available in the market and help lower the share price. But the company’s overall market capitalization value remains intact.
Companies follow the fixed ratio method to issue bonus shares. For instance, if the company declares 4:1 bonus shares and you hold 200 shares of the company, you will get four bonus shares for each share you own.
Advantages of bonus shares
- Investors don’t have to pay any tax for the bonus issues.
- It helps bolster your portfolio.
- It is helpful for long-term investors who want to increase their participation in the company.
- Bonus shares enhance the faith of investors that the company is growing.
- Investors will receive a higher dividend for holding more shares in the future.
- It is usually positive news in the market that the company is preparing for long-term growth.
- Bonus shares increase the liquidity in the market.
- It gives investors an idea that the company is large as more shares become available in the market.
Companies announced bonus shares 2022
Here is a list of companies giving bonus shares in 2022.
FSN Ecommerce Ventures
FSN Ecommerce Venture runs the beauty and personal care vertical under the brand name Nykaa. The company’s board has revised the record date for the bonus issues. The new record date for the bonus issues is now November 11, 2022. Investors will get five fully paid equity shares as a bonus for each fully paid equity share they hold.
Nykaa stocks are currently trading at a 52-week low at Rs 975. Several market watcher companies have predicted the BPC business of Nykaa to remain unaffected. The current revision in share price could be an opportunity for investors to buy.
Follow Nykaa share price on Angel One before investing.
The board of the small-cap textile company has confirmed November 7, 2022, as the record date for bonus issues. The company manufactures and exports all sorts of jute and jute allied products, including woven & non-woven jute geotextiles, treated fabric-rot proof, fire retardant, home decoration items, and jute packaging materials.
Track Gloster Ltd. share price on Angel One.
Ozone World Ltd.
The board has approved issuing bonus shares worth Rs 2,58,93,800. According to the regulatory filing with Securities and Exchange Board of India, the company announced issuing the shares to all eligible holders of existing fully paid equity of Rs 10.
The share price of Ozone World has declined 76 percent in the last five years. The stocks are currently trading at Rs 8.30 apiece, with a 52-week high at Rs 18.99 and a 52-week low at Rs 6 per share.
Track Ozone World Ltd. share price on Angel One’s website.
Now you learned about bonus share meaning, bolster your portfolio with these bonus shares 2022. As mentioned above, bonus issues allow your portfolio to grow and earn more dividends when the company announces dividends in the future. You can also sell your shares in the secondary market for profit. Since bonus issues offer multiple benefits, you must apply for them. These shares will be credited directly to your Demat account. You can open a demat account with us and start exploring such shares through the Angel App.
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Disclaimer: “This blog is exclusively for educational purposes and does not provide any advice/tips on Investment or recommend buying and selling any stock”