When companies announce a corporate action (like a dividend, bonus, or rights issue), two important dates decide who gets the benefit:

1. Ex-Date: The day the stock starts trading without the benefit of the corporate action. To qualify, you must buy the stock before the ex-date. Example: With T+1 settlement in India: If the record date is 27th Dec, you must buy the stock on or before 26th Dec. That’s because shares bought on 26th will settle into your demat on 27th. From 27th Dec (ex-date) onwards, new buyers won’t get the benefit.

2. Record Date: The day a company checks its records to see which shareholders are eligible. If the shares are in your demat account on this date, you will receive the benefit. Example: If the record date is 27th Dec, then shareholders holding the stock in their demat on that day will qualify for the dividend/bonus/rights.

Simple takeaway:

Ex-Date = Cut-off date buy before this to be eligible.

Record Date = Company checks who owns shares.

Yes, you are still eligible. Here’s why:

Eligibility depends on owning shares in your demat on the Record Date / Ex-Date.

Even if you sell the stock on the Ex-Date or Record Date, the shares will only leave (debit from) your demat the next day because of the T+1 settlement cycle.

What is T+1 settlement?

"T" = Trading day.

Shares you buy today (T day) will be credited to your demat tomorrow (T+1).

Shares you sell today (T day) will be debited from your demat tomorrow (T+1)

Example:

Record Date = 27th Dec

You hold shares on 26th Dec → You are eligible.

If you sell on 27th Dec (Record Date / Ex-Date) → You are still eligible, because the shares leave your demat only on 28th Dec (T+1)

To receive bonus shares, you must hold the company’s shares before the record date or ex-date announced for the bonus issue. Shares purchased on the record/ex-date will not make you eligible. This is because of India’s T+1 settlement cycle, which means shares bought today are credited to your demat account the next day.

Example: Record date: 27-Dec-2025. You must hold the shares by 26-Dec-2025 to receive the bonus. Buying shares on 27-Dec-2025 will not qualify you for the bonus issue.

Shares bought are added to your Portfolio on the same day. Just log on to Millions and tap on the Portfolio tab.

Corporate actions are official decisions taken by a company that directly affect its shareholders. They can be a way for companies to reward investors, raise money, or restructure their business and they often impact the value of your stocks.

Common Types of Corporate Actions:

Dividends: Cash payouts to shareholders from company profits.

Bonus Shares: Extra shares given free, in proportion to what you already own.

Stock Splits: Each share is split into multiple shares, making them more affordable and increasing liquidity.

How They Affect You:

Some actions, like bonus issues or stock splits, increase the number of shares you hold but lower the average cost per share, the total investment value stays the same.

Others, like dividends, give you extra cash credited directly to your bank account.

Stock prices may also adjust. For example, prices often drop by roughly the dividend amount on the ex-dividend date.

Why It Matters: Understanding corporate actions helps you anticipate changes in your portfolio and make smarter, more informed investment decisions.

When you invest in stocks, you may come across different corporate actions, official decisions by companies that directly impact shareholders. Here are the most common ones:

1. Dividends: Cash given to shareholders from company profits. Example: If you own 100 shares of XYZ Ltd. and the company declares a dividend of ₹5 per share, you will get ₹500 credited directly to your bank account. Dividends reward you without changing the number of shares you hold.

2. Bonus Shares: Free extra shares given to existing shareholders in proportion to their holdings. Example: You hold 15 shares, and the company declares a 2:3 bonus. For every 3 shares, you get 2 more. Your 15 shares → become 25 shares (15 ÷ 3 = 5; 5 × 2 = 10 bonus shares). Shares are credited automatically to your demat account.

3. Stock Splits: Existing shares are split into multiple new shares, reducing the price per share. Example: You hold 10 shares of ₹100 each (total value ₹1,000). If the company announces a 2:1 split, you now hold 20 shares at ₹50 each. Your total investment remains the same.

4. Rights Issue: A chance for existing shareholders to buy additional shares at a discounted price. Example: You own 50 shares of ABC Ltd. The company offers a 1:5 rights issue at ₹80/share. For every 5 shares, you can buy 1 more at ₹80 (cheaper than market price).

5. Mergers & Demergers: Merger: Two companies combine into one. Demerger: A company splits into separate entities. These actions change the structure of your holdings depending on the swap ratio & price updated or derived basis Cost of Acquisition (COA) declared by the company.

6. Buybacks: When a company repurchases its own shares, usually at a premium price. This reduces the total number of shares in the market, often boosting share value.

7. Partly-Paid Shares: Shares for which only part of the payment is made initially. The rest is paid later. Example: A share costs ₹100. You pay ₹40 first, and the remaining ₹60 is called later. You are considered the shareholder even before paying the full amount.

8. Financial Results Announcements: Quarterly or annual updates about company performance. Example: If XYZ Ltd. posts profits above expectations, its stock may rise. If results are below expectations, prices may fall. Investors watch these closely for decision-making.

Why this matters: Corporate actions can affect your number of shares, stock price, or even cash flow. Knowing them helps you stay prepared and make informed choices.

A dividend is a part of a company’s profit shared with its shareholders, usually paid in cash. Companies declare dividends to reward investors for their trust and investment. If you hold the stock before the Ex-Date, the dividend will be automatically credited to your bank account.

Key things to know about dividends:

Eligibility – You must hold the shares before the Ex-Date to receive a dividend.

Payout – The dividend amount is credited directly to your primary bank account linked to your demat.

Timeline – Credit usually happens within 30–45 days from the Record Date (as per company timelines).

Example:

You own 100 shares of a company.

The company declares a ₹5 dividend per share.

You will receive ₹500 (100 × ₹5) directly in your bank account.

A dividend may affect the stock price or the strike price in case of F&O contracts.

Stocks:

When a company announces a dividend, the stock price may rise slightly, as investors see it as a positive sign of the company’s performance. After the ex-dividend date, the stock price usually drops roughly by the dividend amount. This happens because new buyers after the ex-date are not eligible for the dividend. The exact price change depends on the dividend size, company’s financial health, and market conditions.

Futures & Options (F&O):

Small Dividend (<2% of stock price):

Treated as ordinary dividend.

No changes are made to option strike prices or futures prices.

Large Dividend (>2% of stock price):

Treated as an extraordinary dividend.

Exchanges adjust option strike prices and futures prices to account for the drop in stock price.

This ensures traders are not unfairly affected by the dividend payout

You’re eligible for a dividend if you own the shares before the ex-date. Shares bought on or after the ex-date will not qualify, because of the T+1 settlement cycle—they settle in your account the next day.

Example: A company declares the ex-date for a dividend as 27-Dec-2025. To receive the dividend, you must buy the shares before 27-Dec-2025.

Dividends are usually credited within 30–45 days from the record date. The amount is deposited directly into your primary bank account linked to your Demat account. Payment may be made via bank transfer, cheque, or demand draft, depending on the company’s process.

You can easily view upcoming dividends and other corporate actions:

Home Page>Corporate Actions –See a consolidated list of all upcoming dividends.

Stock Page >Key Events >Corporate Actions - Check dividend details for any specific stock.

This helps you plan your investments and stay informed about rewards from your holdings.

To check the dividends that you have received, you can go to My Profile > Statements & Reports > Dividend Payouts.

When a company pays you a dividend, the amount credited to your account may be less than the declared dividend because of Tax Deducted at Source (TDS). This is an advance tax deducted by the company and deposited with the government on your behalf. The TDS rates for 2025-26 are as follows:

1. Indian Residents:

TDS is applied only if your total dividend from a company exceeds ₹10,000 in a financial year.

Standard TDS: 10% (20% if PAN is not provided).

Example: You receive ₹12,000 dividend:

With PAN: ₹1,200 deducted, so ₹10,800 will be credited to you.

Without PAN: ₹2,400 deducted, so ₹9,600 will be credited to you.

2. HUFs (Hindu Undivided Families):

TDS applies on all dividends, regardless of amount.

Standard rate: 10%

Example: ₹5,000 dividend, ₹500 will be deducted so ₹ 4,500 will be credited to you.

3. Non-Resident Individuals (NRIs):

TDS: 20%

Additional surcharge/cess may apply as per Indian tax laws

Tips:

Check tax credit: Verify the tax deducted on dividends via Form 26AS on the Income Tax portal.

Avoid TDS if eligible: Senior citizens or investors with income below the taxable limit can submit Form 15G/15H to prevent TDS deduction.

Bonus shares are free shares given by a company to its existing shareholders as a way to reward them without paying cash.

How They Work:

Companies announce a bonus in a ratio, like 2:3 or 1:1.

This ratio tells you how many free shares you’ll get for the shares you already own.

Example:

Bonus announced: 2:3

You hold: 15 shares

Calculation: 15 ÷ 3 = 5 → 5 × 2 = 10 bonus shares

Total shares after bonus: 15 + 10 = 25 shares

Key Points

Bonus shares are automatically credited to your demat account.

You don’t need to take any action to claim them.

While your share count increases, the total value of your investment remains the same i.e. the price per share adjusts accordingly.

Bonus shares are automatically credited to your demat account, usually the next working day after the record date. You can buy or sell these shares from T+2 days, meaning two business days after the record date. Example: Record date: 1st September. Bonus shares credited: 2nd September (next working day). Tradable from: 3rd September (T+2). This small gap ensures the trading system properly recognizes the new shares before they can be bought or sold.

However, because you now own more shares, the average price per share decreases.

Example:

You buy 10 shares at ₹50 each → Total investment = ₹500

Company gives 10 bonus shares for free → Now you have 20 shares

Total investment = ₹500 (unchanged)

Average price per share = ₹500 ÷ 20 shares = ₹25

The total value of your holdings stays the same; only the price per share is adjusted.

You may have received a credit confirmation email from CDSL, but the shares are not yet visible in your portfolio. This happens because the shares are first credited to a temporary ISIN (stock code) provided by the depository. These temporary ISINs do not appear in your portfolio view.

Once the company lists the shares on the exchange and the final ISIN is activated (usually 1–2 working days after the record date or as per the company’s timeline), the shares will automatically reflect in your holdings.

A stock split divides each existing share into multiple new shares, reducing the price per share but keeping the total investment value the same. Companies do this to make shares more affordable, increase liquidity, and attract more investors.

Example:

You own 10 shares of ₹100 each → Total investment = ₹1,000

Company announces a 2:1 split → You now have 20 shares

New price per share = ₹50

Total investment = ₹1,000 (unchanged)

You now own more shares at a lower price per share, but your total investment value remains the same.

A 2:1 stock split means that for every 1 share you currently hold, you will receive 2 shares. The total number of shares doubles, but the overall value of your investment stays the same, as the price per share is adjusted downward.

Face Value Adjustment:

When a stock split occurs, the face value of the share is reduced proportionately. For example, if the face value was ₹10 before the split, it becomes ₹5 after a 2:1 split. This keeps the company’s total share capital unchanged. Example: Before split: 50 shares × ₹200 = ₹10,000 & After 2:1 split: 100 shares × ₹100 = ₹10,000. Your investment value remains ₹10,000, but each share is now more affordable for investors.

After a stock split, the additional shares are usually credited to your demat account within 3 working days after the ex-date (the day the stock starts trading at the new, split-adjusted price).

Important points:

The shares may appear in your account, but the trading system might take a day or two to update the quantities.

Once the shares are fully credited, they are immediately available for trading.

No, As to receive additional shares from a stock split, you must hold the company’s shares before the ex-date. Buying on or after the ex-date does not make you eligible for the extra shares. The ex-date is used to determine which shareholders are eligible for corporate actions like stock splits, bonus issues, and dividends. Shares purchased after the ex-date will settle too late to qualify for the split.

When a company announces a stock split:

The number of shares you own increases.

The total value of your investment stays the same.

The average price per share decreases because your investment is now spread over more shares.

Formula: New Average Price = Total Investment ÷ New Quantity of Shares

Example:

You bought 500 shares at ₹100 each → Total investment = ₹50,000.

The company announces a 2,500:500 stock split (each share becomes 5 shares).

New quantity = 2,500 shares, new average price = ₹50,000 ÷ 2,500 = ₹20 per share.

Total investment remains ₹50,000.

Note: Right after the split, your portfolio may temporarily show incorrect values (e.g., ₹10,000). This is normal—values are updated within 1–2 working days after the record date. Once updated, your portfolio will reflect the correct numbers.

A Rights Issue is when a company offers its existing shareholders the opportunity to buy additional shares at a discounted price, usually below the current market value. This helps the company raise capital while giving shareholders a chance to increase their holdings.

Eligibility:

You must hold the company’s shares in your Demat account on the Record Date.

Eligible shareholders receive Right Entitlements (REs) in their Demat accounts.

You can either apply for the new shares using these REs or sell them on the market during the allowed period.

If not used or sold, the REs expire after the deadline.

Example:

You own 200 shares.

The company announces a rights issue 1:10 at a discounted price.

You get the right to buy 20 new shares at the set price (200 ÷ 10 = 20).

You can buy these REs through ASBA (Applications Supported by Blocked Amount). It’s a facility introduced by SEBI that allows you to apply for IPOs, FPOs, Rights Issues (REs), etc., without actually moving money out of your bank account right away. When you apply through ASBA, the application amount is blocked in your bank account

When a company announces a Rights Issue, it must inform all eligible shareholders. Here’s what to expect:

Initial Announcement:

Publicly announced on stock exchanges.

Basic details like issue ratio, price, and record date are shared.

Letter of Offer (LoO):

A detailed document explaining the purpose of the issue, terms, and how to apply.

Usually sent to your registered email.

Application Form / Online Links:

You may receive a Composite Application Form (CAF) or an online application link.

Contains your Rights Entitlement (RE) details and instructions to apply.

Reminders During the Issue Window:

Companies may send emails or SMS reminders before the issue closes.

Post-Issue Updates:

After allotment, you’ll be informed of the number of shares allotted and when they will be credited to your demat account.

A Rights Issue is when a company offers its existing shareholders the chance to buy additional shares at a price set by the company, usually below the current market price. This helps the company raise capital while giving shareholders an opportunity to increase their holdings.

How Rights Entitlements (RE) Work:

Eligible shareholders will receive Rights Entitlements (REs) in their demat accounts before the rights issue opens.

REs are not shares themselves; they are temporary demat securities used to apply for rights shares.

If you don’t use or sell them within the issue window, the REs will expire automatically.

Ways to Apply for Rights Shares:

ASBA (Applications Supported by Blocked Amount)

If your bank supports ASBA, apply online through net banking.

Application money remains blocked in your bank account and is debited only if shares are allotted.

Composite Application Form (CAF)

For offline applications, the company’s Registrar & Transfer Agent (RTA) sends a CAF or you can download it from NSE/BSE websites.

You’ll need to provide:

Bank details (cheque/DD if applying without ASBA)

NSDL/CDSL selection (based on your DP ID)

PAN (for joint accounts, PAN of both holders)

DP ID and Beneficiary number (from your broker profile)

Signatures of all account holders (for joint accounts)

Submit the completed CAF to a Self-Certified Syndicate Bank (SCSB) branch. Eligible banks are listed in the form.

RTA Website (RWAP Facility):

Some issues allow online applications via the Rights Issue Web Application Platform (RWAP).

Register with your PAN and demat details and pay using UPI, NEFT, or RTGS.

Example: Suppose you hold 60 shares and the company announces a 1:3 Rights Issue at ₹120 (market price ₹150).

You’re entitled to buy 20 additional shares (60 ÷ 3 = 20) at ₹120 each.

Apply using your REs before the issue closes.

Allotted shares will be credited to your demat account and visible in your portfolio once listed.

Key Things to Remember:

Apply Before the Deadline: Applications after the closure date are not accepted.

Unutilized REs Expire: If you don’t apply or sell them, REs will lapse.

No Charges: Applying via ASBA or RWAP is usually free.

Eligibility: Only shareholders holding equity shares on the record date are eligible. Holding F&O positions does not qualify.

When a company announces a Rights Issue, here are the important dates you should track:

Record Date: The cut-off date to determine eligible shareholders who will receive Rights Entitlements (REs). You must hold shares in your demat by this date.

Bid/Offer Open Date: The date from which you can apply for rights shares or (if allowed) sell your REs in the market.

Renunciation: If permitted, you can transfer/sell your REs to someone else. Always check the company’s notice to confirm if REs are tradeable.

Bid/Offer Close Date: The last date to apply for or renounce your REs. After this, unused entitlements will expire.

Deemed Date of Allotment: The tentative date when the company or Registrar finalises allotment of rights shares.

Credit Date: The date by which allotted shares are credited to your demat account.

Listing Date: The date when newly allotted shares are listed on the exchange and become tradeable in your portfolio.

Since timelines vary across companies, always refer to the Rights Issue circular or Registrar’s communication for exact dates and details on whether REs are tradeable.

Subscribing to Rights Shares

Rights shares must be applied for within the subscription window announced by the company’s Registrar & Transfer Agent (RTA).

This period is clearly mentioned as “Bid/Offer Opens On” and “Bid/Offer Closes On.”

You must complete your application before the closing date to be eligible for allotment.

REs are temporary securities credited to your Demat account because you held the company’s equity shares on the Record Date. They represent your right to apply for new shares at the discounted issue price. You don’t have to purchase them separately, they are automatically credited if you’re eligible. You can either:

Use REs to subscribe to the rights issue, or

Sell REs in the market (if they are tradeable) during the rights issue window.

Example: If you hold 50 shares and the rights ratio is 1:5, you will receive 10 REs in your Demat account. You can either use these REs to subscribe to the Rights Issue by paying for it or sell them. If you neither sell nor apply for rights shares before the Bid/Offer Close Date, your REs will lapse and automatically be removed from your Demat account. Once lapsed, they carry no value.

If the company makes REs tradeable, you can sell them in the market during the window between the Bid Open Date and the Renunciation Cut-off Date. If REs are non-tradeable, selling is not possible. If you neither sell nor apply for rights shares before the Bid/Offer Close Date, your REs will lapse and automatically be removed from your Demat account. Once lapsed, they carry no value. Example: You receive 20 REs but do not apply or sell them. At the end of the issue, those 20 entitlements will expire and disappear from your portfolio.

What do I do if I want to hold on to the Rights shares I received in my demat account?

When a company announces a Rights Issue, you will receive Rights Entitlements (REs) in your demat account & you will be able to see them in your portfolio. These REs give you the option to buy additional shares at a special discounted price. If you want to hold these shares in your portfolio, you need to subscribe to the Rights Issue. Here’s what to do:

Check instructions – Follow the application steps shared by the company or its Registrar (RTA).

Make payment – Pay the required amount for the rights shares (via ASBA, CAF, or RTA website, depending on options given).

Apply on time – Complete the subscription within the given deadline.

Once subscribed, the new shares will be credited to your demat account after allotment and will start reflecting in your portfolio.

Yes, you can apply for more rights shares than your entitlement. These extra shares are called additional applications. Key points:

Allotment of additional shares depends on demand and availability.

The company first satisfies all shareholders’ basic entitlements, then distributes extra shares proportionately among those who applied for more.

Example: You are entitled to 10 shares but apply for 30 (10 entitlement + 20 additional). If supply is limited, you will get your 10 entitled shares plus a proportion of the 20 extra based on availability.

When a company announces a Rights Issue, eligible shareholders get REs in their demat account. REs let you apply for shares at a discounted price and can be traded on the exchange until the renunciation date (a few days before issue closure). After this date, REs stop trading and will be debited and replaced with new shares if you subscribed, OR Lapse and disappear from your holdings if you did not act. You can track timelines via company communications and stock exchange announcements. If allotment is delayed, contact the company’s Registrar & Transfer Agent (RTA).

A merger is a corporate action where two or more companies combine to form a single entity. Companies merge to grow bigger, expand reach, cut costs, or improve efficiency. For shareholders, your existing shares are exchanged for shares in the new merged company, you don’t lose your investment, it just gets converted.

Swap Ratio: The swap ratio decides how many new shares you’ll get in exchange for your old ones.

Example: Company A merges with Company B. Swap ratio = 3:2 (for every 3 shares of A, you get 2 shares in the new company). If you hold 90 shares of A → you’ll receive 60 shares in the merged entity. Old shares are removed from your demat, and the new ones are credited once the merger is completed.

Impact on Share Price: After a merger, the stock price of the new company may rise or fall depending on:

Market’s view of the merger,

Financial strength of the combined business,

Broader market conditions.

So while the number of shares you hold changes, the value of your investment may also fluctuate based on investor sentiment.

Corporate actions like mergers and demergers affect not only equity shares but also Futures & Options (F&O) contracts. Since contract values must remain fair and tradable, exchanges make specific adjustments.

Impact of Mergers:

When two companies merge, the stock price and outstanding shares change.

Exchanges manage this by:

Expiring existing F&O contracts early (before the merger’s ex-date).

Introducing fresh contracts for the merged entity after the merger is effective.

Impact of Demergers:

In a demerger, one company splits into two or more entities.

To ensure fair settlement, exchanges:

Expire all open F&O contracts early (before the demerger’s ex-date).

List new contracts for the restructured entities, reflecting their revised valuations.

Example: When ITC demerged its hotel business, all open F&O contracts (Jan 30, Feb 27, and Mar 27, 2025 expiries) expired early on Jan 3, 2025. From Jan 6, 2025, new contracts for the restructured entities were introduced on the exchange. These adjustments ensure smooth trading and protect market participants from unfair price distortions during corporate actions.

Credit of Shares: New shares are usually credited to your Demat within 30–45 days from the Record Date, subject to regulatory approvals and Registrar processing.

Visibility in Portfolio: After credit, the shares will be visible in your Portfolio post listing.

Listing on Exchange: Shares of the merged/demerged entity are listed once approvals are complete.

Example: If a demerger’s record date is 1st June, the new company’s shares are generally credited and listed in the next 30–45 days, depending on regulatory confirmation.

A demerger is when a company splits into two or more independent entities. This allows each new company to focus on its specific business, improve efficiency, or unlock shareholder value. For shareholders, a demerger doesn’t mean you lose your investment; instead, you continue holding shares of the parent company and also receive shares of the newly formed entity.

Impact on Your Investment: Your total investment value remains the same, but the cost of acquisition is divided between the parent company and the new entity based on a ratio announced by the company. Example: You own 100 shares of ABC Ltd. @ ₹200 each → Total Investment = ₹20,000. ABC Ltd. demerges its IT business into ABC Tech Ltd. Cost of acquisition ratio announced: 70% (ABC Ltd.) : 30% (ABC Tech Ltd.)

Post-demerger split:

ABC Ltd. → ₹20,000 × 70% = ₹14,000 → Avg. Price = ₹140/share

ABC Tech Ltd. → ₹20,000 × 30% = ₹6,000 → Avg. Price = ₹60/share

Your total investment = ₹14,000 + ₹6,000 = ₹20,000 (unchanged) But now spread across two companies.

A buyback (share repurchase) is when a company buys its own shares from existing shareholders. Companies usually offer a higher price than the market rate, making it attractive for shareholders to participate.

How It Works:

If you participate, you tender (sell) your shares back to the company at the announced price.

If accepted, you receive the money directly in your bank account.

If not accepted, shares are returned to your demat account.

All buyback details (offer price, entitlement, dates) are available in:

Company announcements on NSE/BSE

Official RTA (Registrar & Transfer Agent) emails/letters

Public filings on the company’s website

Types of Buybacks:

1. Tender Offer

The company offers to buy shares at a fixed price.

Shareholders can tender more than their entitlement, but acceptance depends on the acceptance ratio (the proportion of shares accepted by the company).

Unaccepted shares are credited back to your demat.

Payment for accepted shares is credited to your bank account.

Example: Buyback at ₹500. If you tender 100 shares and the acceptance ratio is 40%, only 40 are accepted → You get ₹20,000, and 60 shares return to your demat.

Charges: Nominal fees (e.g., ₹20 + GST/order) + statutory charges (STT, stamp duty). Non-refundable.

2. Open Market Offer

The company buys shares directly on the exchange during the buyback window.

You sell shares like a normal trade, and the company is the buyer on the other side.

Proceeds are credited to your trading account.

Duration: A few weeks to months (as mentioned in the offer document).

Example: Stock price = ₹400, Company buyback = ₹450 & You sell during the buyback → You earn ₹50 premium per share (if accepted).

Corporate actions like mergers and demergers affect not only equity shares but also Futures & Options (F&O) contracts. Since contract values must remain fair and tradable, exchanges make specific adjustments.

Impact of Mergers:

When two companies merge, the stock price and outstanding shares change.

Exchanges manage this by:

Expiring existing F&O contracts early (before the merger’s ex-date).

Introducing fresh contracts for the merged entity after the merger is effective.

Impact of Demergers:

In a demerger, one company splits into two or more entities.

To ensure fair settlement, exchanges:

Expire all open F&O contracts early (before the demerger’s ex-date).

List new contracts for the restructured entities, reflecting their revised valuations.

Example: When ITC demerged its hotel business, all open F&O contracts (Jan 30, Feb 27, and Mar 27, 2025 expiries) expired early on Jan 3, 2025. From Jan 6, 2025, new contracts for the restructured entities were introduced on the exchange. These adjustments ensure smooth trading and protect market participants from unfair price distortions during corporate actions.

If you hold shares on the record date announced in the buyback notice, you are eligible to participate.

Pledged shares: You stay eligible, but must unpledge before tendering, since pledged shares cannot be submitted.

T1 holdings (shares not yet settled): These also cannot be tendered.

Why does a company initiate a Buyback?

Companies may announce buybacks to:

Return excess cash to shareholders

Consolidate promoter or majority ownership

Improve financial ratios like Earnings per Share (EPS) by reducing the number of shares outstanding

Signal confidence that the stock is undervalued

Example: Suppose a company earns ₹100 crore and has 10 crore shares outstanding → EPS = ₹10. If it buys back 2 crore shares, shares outstanding reduce to 8 crore. Now, EPS = ₹12.5 (₹100 crore ÷ 8 crore). Even though profits haven’t changed, EPS rises because the same earnings are spread over fewer shares.

Currently, Buyback applications are not available on Millions. If you wish to participate, you can apply through the following routes:

1.ASBA (Applications Supported by Blocked Amount): via your bank’s net banking portal.

2.Registrar & Transfer Agent (RTA): by submitting your application and mentioning your Millions DP ID.

3.Offline Route: through your bank or broker as guided in the buyback offer documents.

Payment for accepted shares: If your tendered shares are accepted, the payment is usually credited to your primary bank account within 7–12 working days from the buyback closing date.

Unaccepted shares: Shares not accepted in the buyback are returned to your demat account by the extinguishment date.

Extinguishment date: This is when the company officially cancels and destroys the shares it has bought back. It generally happens a few days to a week after the offer closes.

Timelines: These may vary depending on whether the buyback is via tender offer or open-market route, and the company’s processing schedule.

Reduced supply: Since buybacks reduce the number of shares outstanding, each remaining share represents a larger stake in the company.

Possible increase in demand: Buybacks often signal confidence from management that the stock is undervalued, which can boost investor sentiment.

EPS effect: With fewer shares, the company’s earnings per share (EPS) may rise, making the stock appear more attractive.

Example: A company with steady profits buys back shares. Its EPS increases from ₹10 to ₹11. Investors may value the stock more highly, leading to a possible rise in share price.

Note: Market reaction also depends on investor perception, company fundamentals, and broader market conditions so prices don’t always rise after a buyback.

Buyback acceptance is determined by the acceptance ratio, calculated after the buyback window closes and based on total shares tendered versus the buyback size. If more shares are tendered than the company intends to buy, not all tendered shares will be accepted and the acceptance ratio will be less than 1.

Example: If the company wants to buy 100,000 shares but shareholders tender 500,000 shares, the acceptance ratio will be 1:5. If you tender 500 shares, only 100 will be accepted and paid for.

Partly Paid Shares are shares where investors pay only part of the issue price upfront. The remaining amount (called a “call”) is payable later, as per the company’s schedule.

You still hold ownership rights in the company.

However, your shares remain subject to the unpaid amount until all calls are paid.

Example: If a company issues shares at ₹100 each, it may collect ₹40 at allotment and the remaining ₹60 in future calls. On Millions, all partly paid shares are marked with a “-PP” suffix in their name, making them easy to identify.

When you receive partly paid shares, you become a shareholder right away, but the company can ask you to pay the remaining balance (called “calls”) on specific dates.

The Registrar or company will notify you about the schedule and payment process for these calls.

Until the entire balance is paid, your shares remain classified as partly paid.

Such shares may also have a temporary ISIN (security identifier), which changes once the shares become fully paid.

After the initial payment, you need to stay updated on the company’s subsequent call notices.

The company will notify shareholders and share payment instructions (online or offline).

It is important to pay the call amount within the stipulated time.

If you miss the deadline, penalties may apply, and in some cases, the company can even forfeit or recover your shares as per the issue terms.

You can sell partly paid shares on the exchange if they are listed and tradeable.

The buyer of these shares takes over the obligation to pay future call amounts.

Because of this unpaid liability, partly paid shares may have lower trading volumes and liquidity compared to fully paid shares.

Example: You hold 100 partly paid shares with a pending call of ₹60 per share. If you sell them in the market, the buyer will be responsible for paying the ₹60 per share call when due.

The company’s Registrar will notify you of the call amount, due date, and payment process. Once you pay the call, your shares will shift from a temporary ISIN (partly paid) to the permanent ISIN (fully paid). During this transition, your shares may briefly disappear from your portfolio view. After processing and listing (usually 15–30 days), they will reappear under the permanent ISIN and become fully tradeable. Example: If you hold 100 partly paid shares and pay the final call, they may disappear from your holdings for a short while. Within a few weeks, the same 100 shares will show up again as fully paid shares under the permanent ISIN.