Issue of Bonus Shares.
A bonus issue converts free reserves, securities premium or capital redemption reserve into fully paid shares for existing shareholders, with no fresh money. Section 63 sets the conditions: authority in the articles, a board recommendation, shareholder approval and no defaults on deposits, debt securities or employees' statutory dues. We check eligibility, prepare the approvals and complete the allotment and PAS-3 filing.
Typically 2–3 weeks, driven by the general meeting notice period and any increase in authorised capital needed first. PAS-3 takes 2–3 working days after allotment.
A partner — a chartered accountant or company secretary — from the first call to sign-off.
Based on your situation, and fixed in writing before any work starts.
Is this for you?
- Companies with accumulated reserves that want share capital to reflect the size of the business
- Companies adjusting share count ahead of an investment, ESOP grant or listing
- Shareholders who want to recognise retained profits without a cash payout
What you receive at the end.
- 01Eligibility note and bonus ratio workings
- 02Board and general meeting resolutions with minutes
- 03Filed PAS-3, and SH-7 where capital was increased, with SRNs
- 04Share certificates or confirmation of demat credit
- 05Updated register of members and cap table
Issue of Bonus Shares, step by step.
Typically 2–3 weeks, driven by the general meeting notice period and any increase in authorised capital needed first. PAS-3 takes 2–3 working days after allotment.
- 1
Eligibility review
We confirm the source of reserves, that no revaluation reserve is used, that partly paid shares will be fully paid and that there are no disqualifying defaults.
- 2
Capital headroom
If the bonus would exceed authorised capital, we first increase it and file SH-7.
- 3
Board recommendation
The board recommends the bonus and the ratio; once announced, the decision cannot be withdrawn.
- 4
Shareholder approval
Members authorise the issue at a general meeting by ordinary resolution, unless your articles require a special resolution.
- 5
Allotment and PAS-3
The board allots the shares, we file PAS-3 within 30 days, and certificates are issued or demat accounts credited.
- 6
Registers and accounts
We update the register of members, cap table and the accounting entries for the capitalisation.
What we need from you.
Don't have everything yet? We send a short checklist after the first call and work with what you have.
- Audited financial statements showing the reserves to be capitalised
- Articles of association
- Current shareholding pattern
- Confirmation of no default on deposits, debt securities or employees' statutory dues
- Board and shareholder resolutions
- Shareholders' demat details, where shares are held in demat form
The fee depends on your situation. After a short call, the partner who will do the work tells you what's involved and gives you a fixed fee in writing — before any work begins.
- Government fees and statutory charges are billed at actuals.
- When you pay — upfront, in stages or on completion — is agreed in writing with the fee.
Questions about Issue of Bonus Shares.
Ready to discuss Issue of Bonus Shares?
30-minute confidential call — no proposal, no commitment. A partner will write back within one business day.