This is in reference to the report “Tata Sons to raise Rs 200 crore via bonus shares.” Going by the classical definition, bonus shares are free shares issued by a company to its existing shareholders and issued in proportion of the shares held by an investor. This is done through capitalisation of profits and/or reserves. Also, according to established court rulings, shares issued through capitalisation of revaluation reserves shall not be considered as promoters’ contributions, as per Sebi guidelines. Hence I fail to comprehend how Tata Sons will raise the said sum through this proposed bonus issue. Or, am I missing something?
Ajoy K Das, Kolkata
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