The Indian conglomerate ITC (India Tobacco Company Limited) was founded on August 24, 1910. The headquarters of the ITC are located in Virginia House in Kolkata, West Bengal, India.
Consumer goods, apparel, education, hotels and resorts, paperboards and specialty papers, packaging, agribusiness, information technology, and cigarettes are among ITC’s core products.
A share bonus is a new stock market strategy used by corporations to attract new and retain existing shareholders. Rather than paying dividends to employees, the money is used to create greater value.
The new bonus stock lowers the price of each individual share, attracting retail investors and enhancing stock liquidity and activity. The existing shareholders are rewarded without having to dilute their holdings.
Bonus to Share Shares let corporations raise more money from the market by driving up market capitalization.
Contents
- ITC Share Bonus History
- What is a Bonus Share?
- How Does a Bonus Share work?
- Is Bonus Share Good for the Investors?
- What Happens When Bonus Shares are Issued?
- Do Share Prices Fall After Bonus Issues?
- Who is Eligible for Bonus Shares?
- What is the Bonus Announcement Date?
- What is a Bonus Ratio?
- What is a Bonus Record Date?
- What is an Ex Bonus Date?
| Announcement Date | Bonus Ratio | Record Date | Ex-Bonus Date |
| May 20, 2016 | 1:2 | July 4, 2016 | July 1, 2016 |
| June 18, 2010 | 1:1 | August 4, 2010 | August 3, 2010 |
| June 17, 2005 | 1:2 | September 28, 2005 | September 21, 2005 |
| July 12, 1994 | 1:1 | October 6, 1994 | September 12, 1994 |
| September 30, 1991 | 3:5 | January 15, 1992 | December 12, 1991 |
| April 29, 1989 | 1:1 | August 31, 1989 | |
| April 29, 1980 | 1:5 |
Since 1980, ITC has announced bonuses seven times. ITC’s previous bonus announcement was on May 20, 2016, with a bonus ratio of 2:1. With an ex-bonus date of July 1, 2016, the record date is July 4, 2016.
Bonus shares are free shares awarded to shareholders based on their current stock holdings. Instead of being distributed as a dividend, all gains are transformed into free shares in this scenario. Shareholders can then freely hold or sell these shares in the market.
Bonus shares are distributed to shareholders in proportion to their holdings and do not dilute their portfolio. The number of bonus shares granted is determined by the firm; for example, if a company gives 4/3 bonus shares, that number will be multiplied by the number of shares owned, and bonus shares will be awarded correspondingly.
Certainly, Bonus Shares have numerous advantages for investors.-
- Increased Market Capitalization- Earnings that are turned into extra shares can boost a company’s market worth.
- Increased share prices will result in a decrease in the market value of the stock. It can attract new investors and retailers to acquire the stock, resulting in increased stock activity.
- There is no dilution, which is extremely helpful to owners and boosts their portfolio value.
Because there are more equities available in the market, stock liquidity increases, and share prices tend to fall. It can help a company’s stock perform better and attract new retail investors.
Certainly, the stock prices fall as a result of fundamental market economics and supply/demand movements.
Bonus shares are available to shareholders who purchased shares before the ex-date.
What is the Bonus Announcement Date?
It is the date specified by the company’s management for the distribution of bonus shares to shareholders.
What is a Bonus Ratio?
It refers to the distribution of bonus shares in relation to the total number of shares held by an individual or corporation. The underlying mathematical equation used to determine the number of new shares issued is known as the Bonus Ration.
What is a Bonus Record Date?
The added benefit The cut-off date for new shareholders was agreed upon by management and shareholders on the record date.
What is an Ex Bonus Date?
It’s the day before the company’s management and stockholders set a new record.
