Indian companies, listed on the stock exchange, have announced the issuing of bonus shares throughout 2022 with a vengeance. Although market conditions have posed challenges, and inflation and tension of a geopolitical nature held sway, bonus shares were still being offered. Will there be an issue of bonus shares in March 2023 and the year to come just as strong? Above 143 companies issued bonuses in 2022, and analysts suggest that this was largely due to an alteration in the tax rules which are aimed at curbing the bonus stripping practice. These rules kick in on 1 April 2023, so it remains to be seen, say experts, whether a gush of bonus share activity will occur this year.
If you are a shareholder or investor and you are thinking about bonus shares in March 2023, you may want to note some aspects about the issuing of bonus shares. There is no immediate advantage that shareholders gain from bonus shares. This is because of the fact that the prices of stock adjust themselves right after the record date of the bonus issue. Nonetheless, when you open a demat account, the thought of gaining from returns and bonus shares of potential stocks may thrill you. You are not wrong to think of bonus shares as a reward, because bonus issues are often perceived as investor-friendly by the market.
Furthermore, since the sentiment of the market is to always “adjust” the stock price when a bonus is issued, the company’s management views a bonus issue as a price manipulation tactic. When a bonus is announced, some sellers, those sitting on the fence, may be prevented from selling stocks. At the same time, there are those buyers who may want to buy stocks for “tax breaks”. However, investors gain with bonus shares, as if held for a while, prices may go up and rewards may come on strong for investors.
Investors may invest in any upcoming IPO and in equity directly primarily due to the reason that they believe companies may give out bonus shares. There is nothing the matter with this motivation to invest, as bonus shares mean you get a surplus of shares which may have real value for the long term. Companies may not make a habit of issuing bonus shares, but when they do, it is a good idea to invest in them. Thus far, here are the companies that would probably be issuing bonus shares in March 2023:
Investors look to many places while investing and establishing a comprehensive portfolio. An upcoming IPO may be worth your while, and you can easily open a demat account to invest in the stock market. Investing in the stock market comes with a stash of rewards, and bonus shares are just some of them.
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