Stock Split vs Bonus Issue

Stock Split vs Bonus Issue

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Stock Split and Bonus Issue are two of the many corporate actions that companies listed in the stock market take up to increase their quantity of shares being traded. Although most people think they are the same, they are not.  In this post, you will understand Stock Split vs Bonus Issue in complete detail.

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Stock Split

Stock Split is one of the many corporate actions taken by a company, where it reduces the face value of its shares, thereby increasing the number of shares outstanding with the public. This decision is taken by the Board of Directors of the company.

Bonus Issue

Bonus Shares are free extra shares given to all existing shareholders of a company in a particular ratio of the existing shareholdings.

So if we compare the two, we realise that both are very similar but not the same as they vary on certain points as mentioned below.

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