SMC Global Securities Limited

6️⃣Real-Life Examples: 📌Wipro has given bonus shares multiple times 📌IRCTC did a 1:5 split in 2021 to boost liquidity 📌MRF? Never split. Its share price is still ₹1 lakh+ So, you see—different strategies, same market

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4️⃣What does this mean for you as an investor? 📌No extra money in your pocket instantly 📈Liquidity goes up 📉Share price adjusts 🧾Tax implications vary (bonus may have acquisition cost = 0) But most importantly — it shows what the company is signaling

2️⃣What’s a Stock Split then? It’s a cosmetic change ✅ Why? To make a high-priced stock more affordable and increase liquidity 🔁The number of shares increases, but the value stays the same Example: You own 1 share of ₹5,000. Company does a 1:5 split You now hold 5 shares

A 1:1 Bonus and a 1:5 Stock Split can look the same in your Demat account Most retail investors get this wrong Bonus shares ≠ Stock split But if you don't know the difference, you're missing what the company is really trying to tell you Let’s decode it👇 📌 (Bookmark this https://t.co/NCJ57spgV2

3️⃣So how are they different? Let’s break it down: 🟢Bonus = Reward from reserves 🟢Split = Reduce share price visually 🟢Bonus doesn’t change face value 🟢Split does change face value 🟢Bonus uses profits 🟢Split has no balance sheet impact Both increase shareholding, but

7️⃣So, More shares ≠ More wealth These are accounting events, not value-creation moves But… Bonus/Split = Company is bullish on its future And that’s a signal worth watching

1️⃣What are Bonus Shares? It’s the company giving you free shares. ✅ Why? To reward existing shareholders using its profits or reserves. 🔄 It’s like converting past profits into additional equity. Example: You own 100 shares. Company declares a 1:1 bonus. Now you have 200

5️⃣So, which one is better? Trick question It depends on what the company is trying to achieve 👉 Bonus = “We believe in our future earnings” 👉 Split = “We want more people to buy our stock” Both are confidence signals, not cash-generating events