Mumbai, Jan. 3: Hexaware Technologies today said its board would meet on January 11 to consider a bonus issue — the first company to mull such an idea in 2011.

Last year, 118 companies had declared bonus issues, including some frontline firms such as Bajaj Auto, ITC, TVS Motor Company and Wipro.

In a communication to the stock exchanges today, Hexaware, which provides IT, business process outsourcing and consulting services, said the board would also consider declaring an interim dividend.

The announcement saw Hexaware shares surge on the markets.

On the Bombay Stock Exchange, the scrip jumped 10.40 per cent, or Rs 12.10, to close at Rs 128.40.

A similar trend was also seen in the National Stock Exchange where the scrip rose nearly 10 per cent to Rs 127.95.

While making a bonus issue, companies dip into their reserves and convert it into equity capital.

While it is generally welcomed by minority shareholders since they now have more shares, a bonus issue also leads to higher liquidity in the stock.

Companies generally announce a bonus issue when they are performing well or whenever there is a special occasion to reward their shareholders.

Some of the other companies that had rewarded shareholders with bonuses in 2010 were Zee Entertainment Enterprises Ltd, Aegis Logistics, Bajaj Corp, Castrol India, Dabur India, Engineers India, Gujarat NRE Coke and Kansai Nerolac Paints.