RIL Extends Deadline for Partly Paid-Up Shares Payment

India’s largest company by market value, Reliance Industries Limited (RIL), has extended the deadline for the payment of call money on its partly paid-up shares to October 7, 2024. Originally, the deadline was set for September 20, 2024, but after receiving requests from shareholders, the company decided to allow more time. Investors who fail to meet this deadline will see their shares forfeited, making them ineligible for the company’s upcoming bonus issue.

Impacts of Payment on Shareholders

The payment of call money will convert the partly paid-up shares into fully paid-up shares, which will entitle shareholders to various benefits, including bonus shares in a 1:1 ratio, which means they will receive one fully paid equity share for every share they currently hold. In addition, shareholders will receive equity shares of Jio Financial Services Limited (JFSL), which are currently held in trust. Failure to pay the call money will result in the forfeiture of shares and loss of associated rights, such as dividends and voting privileges.

Largest Bonus Issue in Indian Market

RIL’s bonus issue is set to be the largest-ever bonus equity issue in the Indian equity market. It will double the number of shares held by investors, effectively lowering the per-share price, and making it more accessible to new and existing shareholders. The company is yet to announce the record date for determining eligibility for the bonus shares. Currently, Reliance shares are trading at Rs.2,988 as of today, with a market cap of Rs.20.11 lakh crore.

Historical Rights Issue

Back in May 2020, RIL launched India’s largest rights issue, valued at Rs.53,125 crore. Shareholders were allowed to pay in three installments. Initially, 25% of the amount was due at the time of the issue (Rs.314.25 per share), followed by a second installment in May 2021 and the final 50% in November 2021, completing the payment at Rs.1,257 per share. This rights issue marked the largest globally for a non-financial company over the previous decade.

Conclusion: All in all, the extended deadline gives investors more time to make the call money payment and enjoy huge benefits. Forfeiting the shares would mean missing out on one of the biggest bonus issues in India’s stock market history, along with other rewards from Reliance’s diverse business portfolio.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.