Reliance Industries Announces 1:1 Bonus Shares for Shareholders
The Board of Directors of Reliance Industries Limited (RIL) has approved a 1:1 bonus issue, meaning shareholders will receive one free share for each share they currently hold. The record date for determining eligibility will be announced separately.
To accommodate this bonus issue, RIL will increase its authorized share capital from Rs 15,000 crore to Rs 50,000 crore. The bonus shares will be issued by capitalizing from the company’s securities premium account, general reserves, or retained earnings.
Currently, RIL’s pre-bonus paid-up capital is Rs 6,766.23 crore, consisting of 676.62 crore equity shares of Rs 10 each. After the bonus issue, the paid-up capital will double to Rs 13,532.46 crore, comprising 1,353.24 crore equity shares.
The company estimates that Rs 6,766.23 crore will be required to implement the bonus issue, with the final amount based on the paid-up capital on the record date. The bonus shares are expected to be credited or dispatched to eligible shareholders by November 1, 2024.
RIL’s latest audited financials as of March 31, 2024, show a strong reserve base, with the securities premium account holding Rs 99,802 crore, the general reserve at Rs 2,56,549 crore, and retained earnings amounting to Rs 1,03,213 crore.
Doubts Revealed
Reliance Industries Limited (RIL) -: Reliance Industries Limited, or RIL, is one of the biggest companies in India. It is involved in many businesses like oil, gas, retail, and telecommunications.
1:1 bonus issue -: A 1:1 bonus issue means that for every share a person owns, they will get one additional share for free. So, if you have 10 shares, you will get 10 more shares without paying anything.
record date -: The record date is the specific date set by the company to determine which shareholders are eligible to receive the bonus shares. If you own shares on this date, you will get the bonus shares.
authorized share capital -: Authorized share capital is the maximum amount of money a company can raise by issuing shares. RIL is increasing this limit to Rs 50,000 crore to issue the bonus shares.
reserves -: Reserves are the extra money a company has saved up from its profits over the years. RIL will use this saved money to give out the bonus shares.
retained earnings -: Retained earnings are the profits that a company keeps after paying dividends to its shareholders. RIL has a lot of retained earnings, which helps it give out bonus shares.
