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Reliance Industries Limited (RIL), the diversified conglomerate headed by Mukesh Ambani, has officially announced the record date for its upcoming 1:1 bonus share issue. Shareholders who hold RIL shares on October 28, 2024, will be eligible to receive one additional share for every share they currently own. This move, initially announced during the company's 28th annual general meeting (AGM), signifies a significant event for investors and reflects RIL's commitment to shareholder value.
The bonus share issuance, approved by shareholders, will result in a substantial increase in RIL's authorized share capital from Rs 15,000 crore to Rs 50,000 crore. This increase allows for greater flexibility in future capital-raising activities. The bonus shares will be issued out of the company's securities premium account, general reserve, and retained earnings, as per the regulatory filing. The resolution for the bonus share issuance garnered overwhelming support from shareholders, with 99.92% of the votes cast in favor.
While the bonus issue will double the number of shares held by each shareholder, it is crucial to understand that the total value of their investment will remain unchanged. This is because the share price will be adjusted proportionally to reflect the increased number of outstanding shares. The primary benefit of such bonus issues is the enhancement of stock liquidity. With a larger number of shares available in the market, a broader range of investors can participate in trading the stock more easily. This can lead to increased trading volume and a more efficient market for RIL shares.
RIL's history is marked by five previous bonus share issues, demonstrating the company's commitment to rewarding its shareholders. The most recent three bonus issues, in 1997, 2009, and 2017, were all in the ratio of 1:1. The upcoming bonus issue reinforces RIL's commitment to growth and shareholder value. As the company continues to expand its presence across various sectors, from oil and gas to retail and technology, this bonus issue represents a positive step towards further strengthening its financial position and rewarding its loyal investors.
Source: RIL bonus share: Mukesh Ambani-led Reliance Industries sets record date for 1:1 bonus share