Nestlé India Unwraps a Sweet Surprise—1:1 Bonus Shares for Every Investor!

Image Source: The Economic Times

Nestlé India Ltd has made headlines by announcing its first-ever 1:1 bonus equity share issue, a move that will double the number of shares held by existing shareholders. This landmark decision, approved by the Board on June 26, 2025, will see the company issue 96,41,57,160 new shares of ₹1 each, fully funded from retained earnings as per the audited FY25 financials.

The Extraordinary General Meeting (EGM) to formally approve the bonus issue and an increase in authorised capital to ₹200 crore is scheduled for July 24, 2025. The exact record date for determining eligible shareholders will be announced soon, with the bonus shares expected to be credited on or before August 25, 2025.

Key Highlights:

Bonus Ratio: 1:1 (one free share for every share held)
Total Bonus Shares: 96,41,57,160 equity shares of ₹1 each
Source of Funds: Issued from free reserves (retained earnings) as per FY25 audited results
EGM Date: July 24, 2025, to approve bonus and capital increase
Record Date: To be announced, with allotment by August 25, 2025
Capital Change: Authorised capital to rise from ₹100 crore to ₹200 crore
Shareholder Impact: Portfolio value remains unchanged, but number of shares doubles; enhances liquidity and retail participation
Stock Performance: Nestlé India shares surged over 4.5% in the week following the announcement but saw profit booking in early July
Analyst View: Consensus rating is 'HOLD', with expectations of stable growth and a mild price correction post-bonus

This bonus issue is seen as a recognition of shareholder loyalty and is expected to broaden the shareholder base and improve liquidity. The move follows a recent stock split and is part of Nestlé India's ongoing efforts to make its shares more accessible to retail investors.

Source: Goodreturns, Moneycontrol, HDFCSky, NSE Corporate Filings