Bonus Issue

A Bonus Issue is one of the corporate actions where a company issues more shares to its existing share-holders. Existing share holders do not need to pay any extra money for the additional shares. And the number of bonus shares gets decided by the number of current shares own. Bonus issue is also called as capitalization issue. Company declared bonus shares basis on current shared holdings for example if bonus issue ratio is 1:1 so shared holders will get one addition share for each share he/she own. Share holders do not need to pay any extra money for the bonus shares. Though the number of shares gets increase but the actual market value for the share holdings remain same.