Bonus Issue: CDSL shareholders to get one free share for every one held

Central Depository Services (India) Ltd.’s board has approved the issue of one bonus share for every one share held at its board meet on Tuesday (July 2), it said in an exchange filing.

Record date for the said bonus issue is yet to be determined.

This is the first instance of the company considering an issue of bonus shares to shareholders.

The bonus shares are expected to be credited within two months from the date of the Board approval i.e. on or before September 1, 2024.

The issuance of bonus shares will be from capitalisation of free reserves including general reserves and retained earnings of the company subject to the approval of the shareholders, the company said in a filing.

Companies issue bonus shares to capitalise on their free reserves, increase their Earnings Per Share (EPS) and paid-up capital, along with reducing the reserves. Shareholders are issued these shares at no additional cost and hence are also known as free shares.

Shares of CDSL are trading 0.57% lower at ₹2,424.05 apiece on the NSE today. The stock has risen 33% so far this year and is up 110% over the last 12 months.