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regular-article-logo Saturday, 05 October 2024

Reliance Industries board to meet on September 5 to consider bonus issue of shares

The windfall will increase the liquidity of RIL shares and make it more affordable to retail investors

Our Special Correspondent Mumbai Published 30.08.24, 10:34 AM
RIL chairman Mukesh Ambani addresses the company’s 47th AGM in Mumbai on Thursday.

RIL chairman Mukesh Ambani addresses the company’s 47th AGM in Mumbai on Thursday. PTI

The board of Reliance Industries Ltd (RIL) will meet on September 5 to consider a bonus issue in the ratio of 1:1.

The windfall will increase the liquidity of RIL shares and make it more affordable to retail investors.

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“A meeting of the board of directors of the company is scheduled to be held on Thursday, September 5, 2024, to consider and recommend to the shareholders for their approval, issue of bonus shares in the ratio of 1:1 to the equity shareholders of the company,’’ Reliance said in a stock exchange filing.

In a bonus issue, free shares are issued to existing shareholders — as on the record date set by the company — by capitalising reserves. In other words, part of the accumulated earnings or reserves are converted into share capital.

The proposed bonus overshadowed other announcements made by Mukesh D Ambani, chairman of RIL, at its 47th annual general meeting (AGM) on Thursday.

The proposed bonus will be the sixth by the diversified giant: the last one was in 2017-18 in the ratio of 1:1. Bonuses of a similar ratio were declared in 2009-10 and 1997-98.

The first offer was made in 1980-81 in the ratio of 3:5, followed by a 6:10 offer in 1983-84.

Addressing shareholders at the AGM, Ambani attributed the reward of free additional shares to its strong growth.

“When it comes to our value creation strategy at Reliance, we have always believed in speaking by action rather than words.

“Therefore, I have full confidence that the future growth prospects of all our businesses will become a reality within the timelines outlined by me,” Ambani said.

“Higher growth will surely bring richer rewards for you. This confidence is reflected in our notice to the stock exchanges that the board of directors will meet on September 5 to consider issuing bonus shares in the ratio of 1:1.”

He said his father and RIL’s founder Dhirubhai Ambani firmly believed the shareholders are the backbone of Reliance and they deserve a substantial reward from time to time as the company grows from strength to strength.

“I have supreme confidence in the robust performance and bright future growth prospects of all our businesses,’’ he said.

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