Reliance Industries Approves 1:1 Bonus Issue: What You Need to Know

Reliance Industries Limited (RIL) has recently approved a 1:1 bonus issue for its shareholders, marking the sixth such issuance since the company's initial public offering (IPO) in 1973. This move aims to enhance shareholder value and make the stock more accessible to retail investors, particularly given the significant rise in the share price.

The Board of Directors of RIL approved the bonus issue on September 5, 2024, during their 47th Annual General Meeting. This decision follows a pattern of rewarding shareholders with bonus shares, which has been a part of RIL's strategy to create value for all stakeholders. The company has previously issued bonus shares in 1980, 1983, 1997, 2009, and 2017.

Key Details of the Bonus Issue

The bonus issue will be in the ratio of 1:1, meaning that every shareholder holding one fully paid-up equity share of Rs. 10 each on the record date will receive one additional fully paid-up equity share of Rs. 10 each. The record date for determining eligibility to receive the bonus shares has not yet been announced but is expected to be intimated separately.

This bonus issue is significant as it will be the largest ever issuance of bonus equity shares in the Indian equity market. The issuance and listing of bonus shares are expected to coincide with the upcoming festive season in India, making it an early Diwali gift to all esteemed shareholders.

Authorized Share Capital Increase

In addition to the bonus issue, the RIL board also approved an increase in the authorized share capital from Rs. 15,000 crore to Rs. 50,000 crore. This increase will allow the company to accommodate the bonus share issue and position itself for future expansion.

Timeline for Bonus Share Crediting

The bonus shares are expected to be credited or dispatched to eligible shareholders by November 1, 2024. This timeline provides clarity to shareholders, who can anticipate an increase in their holdings in the near future.

The company's latest audited financials as of March 31, 2024, show a solid reserve base. The securities premium account holds Rs. 99,802 crore, while the general reserve stands at Rs. 2,56,549 crore, and retained earnings amount to Rs. 1,03,213 crore.

Historical data suggests that the record date for previous bonus issues typically falls within 40-50 days after the announcement. If this pattern continues, the record date for the 2024 bonus issue could be after October 20.

Reliance Industries has been in the news recently for other significant developments. The Ministry of Heavy Industries awarded the company a 10 GWh capacity for Advanced Chemistry Cell (ACC) manufacturing under the Production Linked Incentive (PLI) Scheme, further solidifying its position in the renewable energy sector.

Shares of Reliance Industries have risen 17% so far in 2024 and are trading above the mark of 3,000. The stock is also trading close to its all-time high of 3,217, which it made in July 2024.

Reliance Industries remains committed to its mission of creating all-round value for all its stakeholders in the true spirit of its We Care philosophy.

For more information on Reliance Industries and its recent developments, visit our website at Direct Post.