India's largest stock in terms of market value, Reliance Industries (RIL) has extended the deadline for the payment of partly-paid shares, which will allow these investors to reap the benefits of its upcoming bonus issues. In the trading week from September 16-20, Reliance shares gained by nearly 1% and are currently a little over Rs 2,970 levels. YTD, the stock zoomed by nearly 15% on BSE.
Reliance Industries Bonus Issue:
The richest man in India, Mukesh Ambani-backed Reliance has announced a bonus issue in the ratio of 1:1. The company will reward investors with 1 free equity share on their existing 1 equity share. Eventually, this will double the number of shares held by shareholders, and the price of Reliance will also become cheaper for both new and existing customers.
It needs to be noted that 1 bonus share means 1 fully paid-up equity share of face value Rs 10/-each, on every 1 (one) fully paid-up equity share of Rs. 10/- each.
That is why, Reliance had earlier fixed September 20 as the deadline for the payment of call money along with interest in respect of the partly paid-up equity shares of the Company. In case of failure to pay, you will not be eligible for bonus issue rewards.
However, Reliance on September 20th extended the last date for payment of unpaid call money by holders of partly paid-up equity shares up to October 7, 2024.
As per the regulatory filing on September 5, the board of directors had approved forfeiture of partly paid-up equity shares on which call money (First Call or Second & Final Call or both) which remains unpaid.
Hence, Reliance announced that the forfeiture of the said partly paid-up equity shares will be effected in case the payment of call money along with interest. Thereby, failure to pay for the partly paid-up equity shares up to October 7, 2024, will lead to confiscation of the shares by the company.
If the payment of call of money and making the partly paid-up shares to fully paid-up entitles you to the following benefits as per RIL's filing:
- Bonus shares in the ratio of 1:1 - Equity shares of Jio Financial Services Limited which are currently lying with JFSL Trust - PPS (RIL).
Also, notably, the record date for identifying eligible shareholders for bonus shares is yet to be announced. The October 7 deadline is only to allow investors to turn their partly-paid shares into fully-paid so that they can be eligible for bonuses.
Reliance's bonus issue is the largest-ever issuance of bonus equity shares in the Indian equity market. RIL is planning to reward bonus shares as an early Diwali gift.
It said, "This will be the largest-ever issuance of bonus equity shares in the Indian equity market. The issuance and listing of bonus shares will coincide with the upcoming festive season in India and will be an early Diwali Gift to all our esteemed shareholders."
Data from RIL showed that this is the sixth bonus issue from RIL since its IPO and the second in this Golden Decade. RIL said the bonus issue is a testimony to Reliance's continued commitment towards rewarding shareholders during the Golden Decade from 2017 to 2027.
Reliance is India's largest private sector company, with a consolidated revenue of INR 10,00,122 crore (US$ 119.9 billion), cash profit of INR 1,41,969 crore (US$ 17.0 billion) and net profit of INR 79,020 crore (US$ 9.5 billion) for the year ended March 31, 2024.
Reliance's activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, advanced materials and composites, renewables (solar and hydrogen), retail and digital services.
BUY/SELL Reliance Shares?
As per the Trendlyne data, the consensus recommendation from 37 analysts for Reliance Industries Ltd. is BUY. EPS is expected to grow by 13.6% in FY25. The latest 1-year average target price on Reliance is of Rs 3,313.64, hinting at 11.50% potential upside ahead.
Last week, on Friday, Reliance share price ended at Rs 2973.10 apiece, up by 1.15% on BSE with market cap of Rs 20,11,544.68 crore. The stock's 52-week high and low is at Rs 3,217.90 apiece and Rs 2,221.05 apiece respectively.
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