I observe that, When a company declares bonus shares say 1:1, the price of the shares goes down to 50% of the value. Ex. Rs. 900 become approx Rs.450/-. Then how can we say that it is bonus, we may get a share extra, but there is not advantage of gaining any extra revenue from this bonus. There will be no change in profit with this bonus.
This is my understanding. Plaease correct me if i am wrong.
RE:Bonus
by Anoop Abraham on Apr 19, 2007 11:02 AM
Well your share price might be halved, but at the same time the number of shares doubles. Effectively you are in the same if not better position as you were before. then it is the performance of the company that would drive share value and you would realize that since you got mroe shares at no extra cost to you, you would benefit (for good cos of course)
RE:Bonus
by rakesh garg on Feb 27, 2007 01:00 PM
I also have the same question. how this could be considered as bonus when the value of the share lowers by 50%. Can anybody clears this doubt. Thanks in advance.
RE:RE:Bonus
by bala gan on Mar 01, 2007 11:42 PM
For eg: last year the price of Infosys before bonus was 3300 and after 1:1 it came down to 1650, again it slowly starts growing and now 2200, Before next bonus again the share price may exceed or reach 3000 . This is the idea of the company to retaing it's shareholders. Hope it clears your query.
Prsently, many IPO issues are coming through book building. To get comphrehensive information about "Book Building", check the following post in ICHP Forum.
RE:New to Stock Market
by PRAMOD BHOSLE on Feb 22, 2007 08:16 AM
Mr. Evergreen, I would like to tell you one thing which I have learnt being in the Market for the past four years, there are no short cuts, earning money is never done in a short term, if it is done once, then the probability of you losing it is also very high the next time you try the same thing.
RE:DERAVATIVE
by shubhda on Mar 25, 2007 01:37 PM
hi well derivative is a product whose value is derived frm the value of 1 oor mor basic variables called bases on contractual manner.it is done on the basis of spot price.it has future and option segment.if want to know more log on to WWW.nseindia.com
