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What are bonus shares? What advantages does the company get by issuing them?Bonus shares are the shares which are allotted to the existing shareholders without receiving any additional payment from them. Issue of bonus share has advantages in increasing the company’s profits into share market. It also helps the shareholders to retain their proportionate ownership of the company. It doesn’t affect the total capital structure and total earning of the shareholders. It actually keeps the morale high of the employees who are associated with the company. It also increases the outstanding shares and share capital base.
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