What is a bonus issue in simple words?

A bonus issue is when a company issues additional shares to its existing shareholders in a certain proportion to the number of shares that they own.

Do bonus shares increase investment value immediately?

No. After a bonus issue, the total value of the investment will remain nearly unchanged as the stock price gets adjusted accordingly.

Who is eligible to receive bonus shares?

Bonus shares are offered to shareholders who hold shares prior to the ex-date and appear on the company's shareholder register on the record date.

Is a bonus issue good for investors?

Bonus share issues can enhance liquidity and raise the number of shares that investors own. But investors need to research the company's fundamentals before they invest.

Are bonus shares taxable in India?

>Bonus shares are not taxable at the time of allotment. The investors only pay tax when they sell the bonus shares.

Can stock prices rise after a bonus issue?

Yes. While prices may adjust at the beginning, strong companies can grow over the long term based on performance and investor sentiment.

Where can investors check upcoming bonus issues?

Bonus issue information is available in the stock exchanges filings, company announcements sections and various brokerage sites.

How Bonus Shares Affect Stock Price, Ownership, and Investor Returns

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How Bonus Shares Affect Stock Price, Ownership, and Investor Returns

Stocks

How Bonus Shares Affect Stock Price, Ownership, and Investor Returns

Learn how bonus shares affect stock prices, shareholding, liquidity, and investor returns without changing company value.

Ridhima Gandhi | Oct 17, 2025, 06:39 PM

How Bonus Shares Affect Stock Price, Ownership, and Investor Returns

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