State-owned Bharat Electronics Limited (BEL) on Thursday announced a bonus issue of its equity shares in the ratio of 2:1. Eligible shareholders of BEL will receive two shares for every one share held by them.
“The proposal to increase authorized share capital, alteration of the memorandum of association of the company, and the issue of bonus shares as stated above is subject to the approval of the shareholders of the company in the AGM scheduled to be held on August 20, 2022,” the company said.
The bonus issue is subject to approval from shareholders of the company at its 68th annual general meeting (AGM), which is to be held on August 30, 2022. Further, the administrative ministry has accorded approval for an increase in authorised share capital from ₹ 250 crores to ₹ 750 crores.
Bharat Electronics has issued bonus shares twice since 2015, in the ratio of 2:1 and 1:10, respectively. This time, the company is looking at issuing bonus shares to the shareholders by capitalizing ₹ 4,87,31,85,886 from its reserves and surplus. The shares had reached their 52-week high of ₹ 287.80 on August 01, 2022. However, they are currently trading at ₹ 273.20, down 3.85% since their previous close of 284.15.
Bonus shares are additional shares that a company offers to its shareholders for free. Many companies issue bonus shares instead of dividends when they are low on cash. Sometimes, they do it to increase retail participation and increase their equity base.
Written by Simran Bafna
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