In a landmark moment for Indian stock markets, HDFC Bank Ltd., the country’s largest private lender, has officially begun trading ex-bonus from Tuesday, August 26, 2025. This marks the bank’s first ever bonus issue in its 30-plus years of history, making it a big event for retail as well as institutional investors.
The bank has announced a 1:1 bonus issue, which means that for every one share held, investors will receive one additional share. While this doubles the number of shares in your demat account, the market value of your investment remains unchanged because the stock price adjusts proportionally.
Let’s break down everything you need to know — from the record date and share price adjustment to allotment timeline and tax rules.
What Does Ex-Bonus Mean?
The term ex-bonus indicates that from today onwards, any investor buying HDFC Bank shares will not be entitled to receive the bonus shares. Instead, the bonus entitlement has already been fixed for those who held the stock before the record date.
So, if you bought shares on or before August 25, 2025, you qualify for the bonus. If you purchase from today (August 26), the entitlement is gone.
Example of Bonus Adjustment
Suppose you owned 100 shares of HDFC Bank at Monday’s closing price of ₹1,969.20. After the 1:1 bonus issue:
- You now have 200 shares in your demat account.
- But the stock price automatically adjusts to around ₹984.60 (roughly half).
- Your overall investment value stays the same — only the share count changes.
This adjustment ensures that there is no sudden “gain” or “loss” in wealth due to the corporate action.
Record Date and Last Day to Buy
- Record Date: August 27, 2025 (but since markets are closed, the effect is captured on August 26).
- Last Day to Buy: August 25, 2025 (because India follows a T+1 settlement cycle).
Investors who bought shares yesterday will see the bonus shares credited to their account, while buyers from today onwards won’t.
Bonus Share Allotment & Trading Timeline
According to exchange filings, the bonus shares will be credited to eligible demat accounts by September 18, 2025.
Once credited, these bonus shares become tradable immediately — usually from the next market session. So, by mid-September, all bonus-allotted investors should see their holdings reflect in their trading accounts.
Tax Implications for Investors
Bonus shares come with specific tax rules in India:
- Cost of acquisition: For tax purposes, the cost of bonus shares is considered zero.
- Holding period: The period for bonus shares starts from the date of allotment.
- Capital Gains Tax:
- If you sell bonus shares within one year, Short-Term Capital Gains (STCG) tax applies at 20%.
- If you hold for more than one year, Long-Term Capital Gains (LTCG) tax applies at 12.5%, provided the gain exceeds ₹1.25 lakh in a financial year.
This is important for traders who may look to book profits quickly after receiving bonus shares.
Impact on HDFC Bank Stock Price
The stock closed at ₹1,969.20 on Monday, August 25. With the bonus adjustment, the stock opened today at nearly half the price.
While it may appear that the stock has “fallen,” in reality, this is simply a mathematical adjustment. The overall market capitalization of HDFC Bank remains unchanged.
Historical Context
Interestingly, this is the first bonus issue ever by HDFC Bank. The last major corporate actions were:
- 2011: Stock split from ₹10 to ₹2 per share.
- 2019: Another stock split from ₹2 to ₹1 per share.
The decision to issue a bonus after more than three decades highlights the bank’s intention to improve liquidity and reward long-term shareholders.
How Does This Benefit Investors?
- Increased Liquidity: With more shares in circulation, it becomes easier to trade HDFC Bank stock.
- Psychological Advantage: A lower per-share price (after adjustment) makes the stock look more affordable to retail investors.
- Shareholder Reward: Existing investors get additional shares at no extra cost, reinforcing confidence in the company.
Market Performance Before Bonus
HDFC Bank’s stock has been somewhat mixed in recent months:
- 1-Month Performance: Down about 2%.
- 2025 YTD Performance: Up more than 10%.
The bonus issue is expected to attract fresh retail participation, especially given the lower post-adjustment stock price.