Over two dozen companies announce bonus issue in CY17

It's raining bonus shares for investors, with over two dozen companies announcing a bonus issue since the start of calendar year 2017 (CY17). Of these, nearly a dozen have announced the issue in the past one month alone. By comparison, 15 companies had made such an announcement in the previous corresponding year, while 17 companies did so in CY15 Thus far in calendar year 2017 (CY15), as many as 27 companies, including ICICI Bank, Petronet LNG, Godrej Consumer Products, Biocon and Wipro have announced bonus issues. In May alone, as many as six companies rewarded their shareholders via this route, while the board of Munjal Auto Industies is scheduled to meet on May 22 and Shilpi Cable Technologies on May 28 to consider a bonus. Nifty Trading Tips

Among the prominent ones, ICICI board recommended a bonus in the ratio of 1:10 i.e. one bonus share for every 10 shares held by investors. Godrej Consumer Products and Petronet LNG, too, announced a 1:1 bonus (one equity share for every one existing equity share). It is the maiden bonus issue for all these firms. In the information technology and the pharma space, Wipro declared bonus shares in the ratio of 1:1 in April, while Biocon announced in the ratio of 2:1 (one equity share for every two exiting equity shares). Market observers say bonus shares are being given to improve liquidity, besides rewarding the shareholders. Post the issue, the stock price gets adjusted according to the bonus ratio. The total market value of the company would, however, remains the same. Future & Option Trading Tips