1:1 Bonus Share Issue A Milestone Moment
For the first time in its history, HDFC Bank will issue bonus shares in a 1:1 ratio. This means every shareholder will receive one bonus share for each share they already own.
What Makes It Special?
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This isn’t just about increasing share count. It’s about boosting investor sentiment, enhancing liquidity, and broadening accessibility especially for retail investors.
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With the record date set for Wednesday, August 27, 2025, shareholders need to hold the stock by Tuesday, August 26 (T+1 settlement) to be eligible.
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Expect to see the bonus shares credited to your demat account by or before September 18, 2025.
What’s Changing with the Capital Structure?
| Item | Before Bonus | After Bonus |
|---|---|---|
| Face Value per Share | ₹1 | ₹1 |
| Total Paid-up Capital | ₹766.79 crore | ₹1,533.58 crore |
| Total Shares Outstanding | ~766.79 crore | ~1,533.58 crore |
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These bonus shares will be issued from the bank’s securities premium reserves, a reflection of its ample surplus.
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The bank will carry out the issue in fully dematerialized form, meaning you don’t need to do anything manually just sit back and wait for the credit.
Approvals and Process
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The bonus issue is subject to shareholder approval via postal ballot/e-voting, which HDFC Bank is expected to initiate soon.
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Regulatory nods from SEBI, NSE, and BSE will follow before the shares get listed and credited.
Why Is HDFC Bank Doing This Now?
The bonus issue aims to:
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Reward shareholders for their loyalty
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Improve liquidity in the stock
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Make shares more affordable, especially post the recent rally
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Celebrate and solidify confidence post the successful HDFC Ltd merger
Special Interim Dividend A ₹5 Surprise
Alongside the bonus, the bank is also handing out a ₹5 per share special dividend a 500% payout on the ₹1 face value.
Key Details:
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Record date: Friday, July 25, 2025
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Expected payout date: Monday, August 11, 2025
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Total payout size: ~₹3,320 crore
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Funded entirely from accumulated profits, showing off the bank’s financial muscle
Tax Reminder:
As per current tax laws (Finance Act 2020), this dividend will be taxable in your hands, not the company’s. TDS will be deducted unless you're exempt or have submitted lower deduction certificates.
What Happens to Share Price?
Here’s what investors need to keep in mind:
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After the bonus, the share price is expected to adjust downward, approximately halving to maintain market cap neutrality.
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The bonus is not taxable upon receipt, but capital gains tax will apply when sold in the future.
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With more affordable share prices and increased float, market participation is expected to rise.
Financial Strength Behind the Move
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Q1 FY26 Net Profit: ₹18,155 crore (up 12.2% YoY)
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Net Interest Income (NII): ₹31,429 crore (up 16%)
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Net Interest Margin (NIM): ~3.4%
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Capital Adequacy Ratio (CAR): A robust ~19.9%
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Liquidity Coverage: One of the strongest in Indian banking
Despite some stress from agricultural loans and credit provisioning, HDFC Bank’s fundamentals remain exceptionally solid.
Context: A Year After the Merger
It’s been a year since the landmark HDFC Ltd merger, and this announcement comes as a testament to:
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Successful integration
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Cost efficiencies
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Cross-selling momentum
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Strengthened mortgage business
The bonus and dividend underscore the management's confidence in scalability, profitability, and investor alignment.
Key Dates for Your Calendar
| Event | Date |
|---|---|
| Board Approval | July 20, 2025 |
| Dividend Record Date | Friday, July 25, 2025 |
| Dividend Payment Date | Monday, August 11, 2025 |
| Bonus Share Record Date | Wednesday, August 27, 2025 |
| Bonus Credit Date | On or before September 18, 2025 |
Investor Checklist: What You Should Do
Final Assumption
This isn’t just a corporate action it’s a strategic statement. HDFC Bank is signaling its transition into a next-gen financial powerhouse, capable of scaling profitably while remaining shareholder-focused. If you’re already invested, congratulations you’re part of a defining moment in Indian banking history. If not, you might want to watch the ex-dates closely.
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