What is a Corporate Action?

A corporate action is a significant event initiated by a company that impacts its existing shareholders. Examples include the issuance of bonuses, dividend credits, rights issues, stock splits, and the issuance of shares of an amalgamated company.

What is a Record Date?

The record date is the specific date set by a company on which you must hold shares in your Demat account to be eligible for a corporate action.

When Should I Buy a Stock to Be Eligible for the Corporate Action Benefit?

To qualify for corporate actions like dividend or bonus credits, you must have the shares in your Demat account by the record date. You should purchase the shares at least one working day before the record date, known as the Ex Date.

What is Ex Date?

The Ex Date is the first day from which you are no longer eligible for the corporate action, even if you buy the shares. It is essentially the date on which the stock starts trading without the corporate action benefit.

What is the Last Cum Date?

The Last Cum Date is the last date on which you can purchase shares to be eligible for the corporate action.

Can I Sell the Shares and Still Get the Corporate Action Benefit?

Yes, you can sell your shares on or after the Ex Date and still receive the corporate action benefit, as the shares are removed from your Demat account only after the record date.

Why Are Bonus Shares Not Visible in My Holdings Even Though the Company Has Issued Them?

Bonus shares may not be immediately visible in your holdings if they are pending approval for listing by the Exchange. This process typically takes a day or two after allotment. Once approved, they will automatically appear in your Trading Page.

To Which Account Will My Dividend Credits Be Given?

Dividends will be credited directly to your bank account if:

a) You held the shares in your Demat account on the record date, and
 b) Your bank account details are correctly updated in your Demat account.

Will TDS Be Deducted on Dividend Credits?

Yes, TDS will be deducted if your shares are held in the Client Unpaid Securities Account (CUSA), which is used when you have a debit balance in your ledger. The dividend, after TDS, will be credited to your ledger account.

Will Corporate Actions Affect F&O Contracts?

Yes, corporate actions can affect F&O contracts, with changes potentially impacting lot size, base price, strike price, or expiry date to ensure the market value remains consistent before and after the corporate action.

What Will Happen to the Contracts I Hold Before the Corporate Action?

Contracts held before a corporate action will automatically lose their value upon expiry. It's essential to square off these contracts to avoid losses. The expiry date will be announced in advance, allowing you to take necessary actions.