Mukesh Ambani-led Reliance Industries on Thursday (September 5) in the recent board meeting, announced two major proposals, the company said through an exchange filing.
Bonus Shares and Capital Increase
The board has recommended two major changes for shareholder approval through a postal ballot which included:
Bonus Shares Issuance
The company board approved a 1:1 bonus issue, meaning shareholders will receive one new fully paid-up equity share for every existing share they hold. This bonus will be funded by capitalising securities premium, general reserve, and retained earnings.
Increase in Authorised Share Capital
The authorised share capital is set to increase from Rs 15,000 crore to Rs 50,000 crore to accommodate the new shares and future growth.
Forfeiture of Partly Paid-Up Shares
The board has in the meeting decided to forfeit partly paid-up equity shares if call money - either the First Call or Second and Final Call - remains unpaid by September 20, 2024.
This move will affect those shareholders who have not cleared their dues by the specified date.
Understanding the Bonus Share Details
Source of Bonus Shares
The bonus shares will be issued from the securities premium account, general reserve, and retained earnings as of March 31, 2024.
Mukesh Ambani-led Reliance Industries on Thursday (September 5) in the recent board meeting, announced two major proposals | File/ Representative Image
Bonus Ratio
Shareholders will receive one bonus share for every existing share held, doubling the number of equity shares.
Share Capital Changes
Pre-Bonus Share Capital: Currently, the paid-up share capital stands at Rs 6,766.23 crore, represented by 676.62 crore equity shares of Rs 10 each.
Post-Bonus Share Capital: After the bonus issue, the paid-up share capital is expected to rise to Rs 13,532.46 crore, with 1353.24 crore equity shares of Rs 10 each.
Free Reserves for Bonus Issue
To implement the bonus issue, the company requires Rs 6,766.23 crore. This amount will be drawn from the free reserves and share premium available as of March 31, 2024, the company said in the regulatory filing.
Financial Highlights
As on March 31, 2024 (as per latest audited balance sheet):
a. Securities Premium – Rs. 99,802 crore;
b. General Reserve – Rs. 2,56,549 crore;
c. Retained earnings – Rs. 1,03,213 crore
