What is the impact of bonus shares?

Impact of Bonus Shares

1. Increased Shareholding: Shareholders receive additional shares, increasing their total holdings.
2. No Cost to Shareholders: Bonus shares are issued without any cost to shareholders.
3. No Immediate Wealth Creation: The overall market value of their holdings remains the same, but the price per share is reduced.
4. Liquidity and Affordability: The stock price is reduced, making the shares more affordable and potentially increasing liquidity.
5. Perception of Strong Reserves: Issuing bonus shares can be a sign that the company has strong reserves and is performing well.

CLICK HERE – to see impact of bonus shares  with a real-world example (calculations)