The offer of new shares to existing shareholders at no cost, in proportion to the amount of their current holding, is known as:

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A bonus issue is sometimes referred to as a scrip issue or capitalization issue. It is a form of financial incentive offered to the company's shareholders by issuing additional shares to those who already hold shares in the company. These shares are issued for free and in proportion to the number of shares already held by the shareholder. This is done to use the accumulated reserves or profits to increase the equity base of the company. A bonus issue is considered to be a shareholder-friendly measure as it does not dilute the ownership percentage of existing shareholders.

The Offer of New Shares to Existing Shareholders at No