SEBI Proposes Uniform Timelines for Bonus Shares

On 5th August 2024, the Securities and Exchange Board of India (SEBI) proposed a standardized timeline to ensure the prompt credit and trading of bonus shares, aiming to facilitate T+2 trading after the record date.

SEBI proposal seeks to establish a uniform timeline for the credit and trading of bonus shares, addressing the current lack of specific guidelines.
Under existing regulations, bonus shares are credited and made available for trading within 2-7 working days post record date, but there is no standardized timeline for this process.
The absence of specific guidelines has led to inconsistencies in the timing of when bonus shares are credited and available for trading.
To address these issues, Sebi proposes that bonus shares be made available for trading on the next working day after allotment, enabling T+2 trading.
This move is aimed at reducing investor risk associated with market volatility due to delays in the crediting of bonus shares.
The proposed uniform timelines will ensure a more streamlined and timelier implementation of bonus issues.