Why haven't the bonus shares appeared in the holdings despite the decrease in stock price?
Bonus shares are shares that are given to existing shareholders free of charge, based on the number of shares they currently hold. The allotment of bonus shares is usually done in a fixed ratio, such as 1:1, 2:1, 3:1, and so on. To be eligible for bonus shares, shareholders must hold shares on the ex-date/record date, which is determined by the T+1 settlement cycle. For instance, if the ex-date/record date for the bonus is 10th April, shareholders must buy the stock on or before 9th April.
The same concept applies to dividends. When bonus shares are issued, the share price decreases based on the ratio of the issue, but the total investment value of the held stocks remains the same. The remaining value is then given to the shareholders in the form of bonus shares. The balance amount is credited to the shareholder's registered bank account if the eligible bonus shares are not in whole numbers.
It typically takes around 15 days from the record date for bonus shares to be credited to the shareholder's demat account, but this can vary depending on the Registrar and Share Transfer Agents (RTA). Shareholders receive a notification from CDSL when the bonus shares are credited to their demat account. The bonus shares are first credited under a temporary ISIN and are not immediately admitted to trading. It usually takes around 4-5 days for the shares to move from the temporary ISIN to the permanent ISIN after receiving approval for trading. The bonus shares will only appear on Kite after being approved for trading.
Before bonus shares are credited to the shareholder's demat account, their holdings in Kite/Console may display an artificial drop in P&L. Once the bonus shares are credited to the demat account, the P&L will be restored to its correct value. Zerodha displays the bonus quantity only after it has been credited. Bonus and stock splits have similar impacts, but there is a difference in the face value of the shares. In stock splits, the face value of the shares is reduced.
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