Bonus shares represent complimentary additional shares granted by companies to their existing shareholders, contingent upon their current shareholdings. For instance, when company ABC declares a 2:1 bonus share issuance, each shareholder receives two bonus shares for every share they possess.
There are several rationales behind companies issuing bonus shares, generally delivering favourable outcomes for investors looking to mitigate dividend tax expenses. Bonus shares are exempt from taxation and concurrently augment the number of shares within an investor’s portfolio, providing opportunities for profit realisation through trading.
From the company’s perspective, bonus shares serve the purpose of preserving their capital reserves, available for potential reinvestment. Furthermore, in situations where a company faces constraints in terms of available cash, bonus share issuance can be an effective strategy to uphold liquidity levels.
Crucially, it’s worth emphasising that bonus shares do not exert any influence on a company’s market capitalisation value. However, they do contribute to heightened market liquidity by introducing more shares into circulation. Consequently, this increased liquidity can lead to a decrease in share prices, fostering greater engagement from retail investors, particularly those with smaller investment portfolios.
In this article, check the upcoming bonus shares in October 2023.
Bonus Stocks in October 2023
Jonjua Overseas Ltd
Incorporated in 1993, Jonjua Overseas Limited is involved in service exports, corporate consultancy, agriculture, the production of organic manure, as well as the sale of printed materials. The company has declared bonus shares at a fixed ratio of 9:50. The record date is October 10, 2023.
Key Financials of Jonjua Overseas Ltd
- Market Cap: ₹8.62 crore
- Return on equity(%): 9%
- PE Ratio: 7.37
- Debt to Equity Ratio: 0.00
Shri Venkatesh Refineries Ltd
Shri Venkatesh Refineries Limited, incorporated in 2003, works around the refining and conservation of edible oils, with a primary focus on soybean oil. The company’s primary business segment involves the manufacturing and trading of both refined and raw oil products. The company has declared bonus shares at a fixed ratio of 1:1. The record date is October 29, 2023.
Key Financials of Venkatesh Refineries Ltd
- Market Cap: ₹225 crore
- Return on equity(%): 16.55%
- PE Ratio: 18.44
- Debt to Equity Ratio: 1.14
The above list of companies in India have announced bonus shares for October 2023. If you’re interested in learning more about forthcoming bonus share opportunities in India for 2023 and wish to engage in stock market investment or trading, open a Demat account with Angel One today to embark on your investment journey.
Disclaimer: This article has been written for educational purposes only. The securities quoted are only examples and not recommendations.