Hardwyn India, a provider of kitchen, door, glass, wardrobe and sliding hardware solutions, has announced a bonus issue in the ratio of 2:5 for its shareholders.
In an exchange filing released on Friday, Hardwyn India said that its board of directors met on June 5 to consider and approve the issuance of “bonus equity shares in the ratio of 2:5 i.e., 2 bonus equity shares of Rs 1 each fully paid-up for every 5 equity shares of Rs 1 each fully paid-up held by the shareholders of the company as on the record date, by capitalization of free reserves/retained earnings, subject to the approval of members in Extraordinary General Meeting”.
Along with the bonus issue, Hardwyn’s board also approved increasing the company’s authorised share capital from the existing Rs 50 crore, divided into 50 crore shares with a face value of Rs 1 each, to Rs 70 crore, divided into 70 crore equity shares with a face value of Rs 1 each.
The Extraordinary General Meeting (EGM) where the bonus issue will be voted on is scheduled for July 3 this year. The company set June 26 as the cut-off date to determine who can vote in the EGM.
Hardwyn India bonus issue record date
As part of the bonus issue, the company proposed to issue nearly 19.54 crore new shares for its shareholders, using its free reserves or retained earnings, which stood at Rs 19.65 crore at the end of the financial year 2026.
The record date to determine the eligibility of shareholders for the 2:5 bonus issue is yet to be announced. Hardwyn said that the bonus issue is expected to be dispatched within two months of the board’s approval, that is, by August 4.
A bonus issue consists of free shares distributed by a company from its reserves and is often seen as a sign of strong financial health and growth prospects. While the issue of bonus shares increases the total number of outstanding shares, it does not change the company’s market capitalisation. However, it can improve liquidity and affordability, allowing more investors to add shares of the company to their portfolio.
Anand Rathi names Hardwyn India as its pick of the month
Anand Rathi Investment Services named Hardwyn India as its pick of the month in its report dated June 2, highlighting that the stock is currently trading near its 20 DEMA support. “Additionally, the DMI indicators are positively aligned, while the ADX is placed at 32, reflecting strong trend strength and supporting the possibility of further upside momentum,” it said.
“Therefore, traders may consider accumulating the stock in the Rs 24.50–25.50 zone, with a stop-loss at Rs 22.50. On the upside, the stock has the potential to move towards the Rs 30 target in the near term, provided it sustains above the mentioned support levels,” it added. The target price implies an upside potential of nearly 23% from the stock’s previous closing price of Rs 24.41 apiece.
Hardwyn India share price
Hardwyn India shares declined nearly 1% to trade at Rs 24.21 apiece, at around 11.05 am on Monday. The stock has fallen around 4% in five days and 2% in one month. Overall, the shares of the company are, however, up over 44% in 2026 so far.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
While I don't own any stocks or manage a personal investment portfolio (being an AI!), a 2:5 bonus issue announcement is always an interesting event for shareholders to track.
To help you evaluate what this means for the company and its investors, here is a breakdown of how a 2:5 bonus issue works and what you should look out for:
What does a 2:5 Bonus Issue mean?
In a 2:5 bonus ratio, the company is offering 2 free bonus shares for every 5 existing shares you hold in your portfolio.
Example: If an investor owns 100 shares of this smallcap company, they will receive 40 additional shares entirely for free $(100 \times \frac{2}{5})$, bringing their total holdings to 140 shares.
Does it change the investment value immediately?
No. A bonus issue is essentially a book adjustment where the company moves funds from its free reserves to its share capital account. Because the total number of outstanding shares increases, the stock price adjusts downward proportionately on the Ex-Bonus Date.
If the stock was trading at ₹140 before going ex-bonus, the price would theoretically adjust to ₹100 post-bonus, meaning the total value of your investment remains exactly the same at the exact moment of the split.
Why do smallcap companies announce bonus issues?
Boosts Liquidity: Smallcap stocks can sometimes have lower trading volumes. Lowering the price per share makes the stock more affordable and attractive to retail investors, increasing liquidity.
Positive Market Signal: It signals management's confidence in the company’s future earnings and financial health, as only fundamentally stable companies can capitalize reserves to issue bonus shares.
Future Dividend Advantages: If the company maintains its dividend per share amount in the future, investors will receive higher total payouts because they now own more shares.
Key Dates to watch if you are tracking this stock:
Record Date: The cutoff date set by the company. You must officially be in the company's share registry on this day to be eligible for the free shares.
Ex-Bonus Date: Typically one working day before the record date. To get the bonus, you must buy the stock before this date. If you buy it on or after the ex-bonus date, the previous owner gets the bonus, and you buy it at the adjusted lower price.
If you are tracking a specific smallcap company that just made this announcement, feel free to share the name! We can look into its current financials, record dates, or market sentiment.
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