HDFC bank bonus issue has approved a historic 1:1 bonus issue and a ₹5 per share interim dividend for FY26, announced alongside robust Q1 results. This move signals strong financial confidence, but what does it mean for investors? Dive into the details of this landmark decision.

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HDFC bank bonus issue and Dividend Details

Event	Details
Bonus Issue Ratio	1:1 (1 equity share of ₹1 for every 1 fully paid-up equity share held)
Record Date (Bonus)	August 27, 2025
Dividend Amount	₹5 per share (500% of face value)
Record Date (Dividend)	July 25, 2025
Dividend Payment Date	August 11, 2025

Key Features of the Announcement

Feature	Impact
First-Ever Bonus Issue	Increases share count, potentially boosting liquidity and affordability
Special Interim Dividend	Rewards shareholders with immediate returns
Strong Q1 Performance	12% YoY net profit growth to ₹18,155 crore, reflecting financial strength

Why This Bonus Issue Matters

HDFC Bank, India’s largest private lender, made history on July 19, 2025, by approving its first-ever 1:1 bonus issue. This means shareholders will receive one additional share for every share they own, effectively doubling their holdings without altering the total investment value. The move aims to enhance stock liquidity and make shares more accessible to retail investors. With a record date of August 27, 2025, eligible shareholders will see bonus shares credited by mid-September.

Dividend Sweetens the Deal

Alongside the bonus issue, HDFC Bank announced a special interim dividend of ₹5 per share, payable on August 11, 2025, for shareholders on record by July 25. This follows a ₹22 final dividend for FY25, showcasing the bank’s commitment to rewarding investors. The dividend yield, based on recent share prices around ₹1,957, is approximately 1.1%.

Financial Strength Fuels Confidence

The announcement coincides with HDFC Bank’s Q1 FY26 results, reporting a 12% year-on-year net profit increase to ₹18,155 crore and a 5.4% rise in net interest income to ₹31,438 crore. Despite a slight uptick in gross NPAs to 1.40%, the bank’s robust loan growth (6.7% QoQ) and deposit growth (16% YoY) signal a strong post-merger trajectory.

Investor Implications

The bonus issue could lower the share price, making it more attractive to new investors, while the dividend offers immediate returns. However, earnings per share may dilute slightly due to increased share count. Analysts view this as a sign of confidence, with the stock up 23% over the past year.

A Strategic Move Post-Merger

Post its merger with HDFC Ltd., the bank is leveraging its strengthened balance sheet to reward shareholders and boost market sentiment. This move could set a precedent for other banks, with 147 companies announcing bonus issues in 2025 alone.

Disclaimer: This article is for informational purposes only and not financial advice. Consult a certified financial advisor before investing. Views expressed are those of the author.

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