By Chaitanya
BBA Finance Graduate with over 6 years of experience in the stock market and finance.
Karur Vysya Bank (KVB) has officially announced a 1:5 bonus share issue for its shareholders, a strategic move expected to significantly boost the liquidity of its shares in the market. This decision, widely publicised through newspaper advertisements on August 14, 2025, in prominent publications like Business Standard (English) and Dinamalar (Tamil), also adheres to the necessary SEBI regulations with timely notifications to both the NSE and BSE. Shareholders are set to receive one additional share for every five shares they currently hold, without any extra cost to them, making it an attractive proposition for existing investors.
Delving into the KVB Bonus Share Details
The bank has set August 26, 2025, as the crucial Record Date for this bonus issue. This means that to be eligible for the bonus shares, investors must hold or purchase KVB shares before the cum-date, which is August 25, 2025. The Ex-Date is also August 26, 2025. Following the record date, the bonus shares are expected to be credited to eligible shareholders’ Demat accounts within two trading days from August 26, 2025. This strategic move by Karur Vysya Bank aims to increase the total number of shares in circulation while maintaining the company’s overall market capitalisation, ensuring proportional ownership remains unchanged.
It is estimated that approximately 16.11 crore new shares will be issued as part of this bonus, translating to a monetary value of around Rs 32.23 crore based on the face value of ₹2 per share. This exercise effectively broadens the shareholder base and makes the shares more accessible to a wider range of investors. For a quick overview of the key dates and eligibility, refer to the table below:
Bonus Issue Details Table
| Company | Bonus Ratio | Record Date | Ex-Date | Eligibility | Credit Timeline |
|---|---|---|---|---|---|
| Karur Vysya Bank (KARURVYSYA) | 1:5 | August 26, 2025 | August 26, 2025 | Shareholders holding/buying before cum-date August 25, 2025 | Within 2 trading days from August 26, 2025 |
A Look at Karur Vysya Bank’s Strong Financials
The announcement of the bonus issue comes on the back of impressive financial performance by Karur Vysya Bank. For the first quarter of Financial Year 2026 (Q1 FY26), ending June 2025, the bank reported a robust net profit of ₹521.45 crore, marking a significant 14% year-on-year growth. This positive trend was also reflected in their Net Interest Income (NII), which saw a 5% increase to ₹1,079 crore, and an 8% rise in Operating Profit, reaching ₹805.50 crore.
Furthermore, KVB has made substantial progress in improving its asset quality. The Net Non-Performing Assets (NPA) saw a sharp reduction of over 42% year-on-year, standing at a mere ₹170 crore. Consequently, the Net NPA Ratio improved considerably to a low 0.19%. These strong figures, as reported by financial news portals like Angel One and Economic Times, underscore the bank’s sound operational efficiency and prudent risk management practices.
Karur Vysya Bank’s History of Rewarding Shareholders
This 1:5 bonus share issue is not an isolated event for Karur Vysya Bank. The bank has a consistent track record of rewarding its shareholders through similar initiatives. This latest bonus is the fourth such issue since 2002, reflecting KVB’s commitment to sharing its growth with its investors. Previous bonus issues include a 1:1 ratio in 2002 and 2006, a 2:5 ratio in 2010, and a 1:10 ratio in 2018. This historical pattern suggests a stable and shareholder-friendly approach by the bank’s management, indicating confidence in future prospects. For a detailed look at KVB’s bonus issue history, please see the table below:
Historical Bonus Issues by Karur Vysya Bank
| Announcement Date | Ex-Bonus Date | Bonus Ratio | Remarks |
|---|---|---|---|
| 24 Jul, 2025 | 26 Aug, 2025 | 1:5 | For every 5 shares held, 1 bonus share issued |
| 25 Jun, 2018 | 14 Aug, 2018 | 1:10 | For every 10 shares held, 1 bonus share issued |
| 07 Sep, 2010 | 16 Sep, 2010 | 2:5 | For every 5 shares held, 2 bonus shares issued |
| 25 May, 2006 | 19 Jul, 2006 | 1:1 | For every 1 share held, 1 bonus share issued |
| 01 Apr, 2002 | 21 Oct, 2002 | 1:1 | For every 1 share held, 1 bonus share issued |
| 01 Mar, 1995 | – | 1:1 | For every 1 share held, 1 bonus share issued |
Recent Developments and Karur Vysya Bank’s Share Performance
Beyond the bonus issue, Karur Vysya Bank has been active on several fronts in August 2025, demonstrating its continued focus on shareholder value and operational excellence. Key updates include:
- August 14, 2025: The official bonus issue announcement was published in leading newspapers, Business Standard and Dinamalar, ensuring broad public awareness.
- August 5, 2025: The bank declared a dividend of Rs 2.60 per share, which was its latest prior dividend announcement, further reinforcing its commitment to shareholder returns.
- Q1 FY26 Financials: As mentioned, the quarter ending June 2025 saw a healthy net profit of ₹521.45 crore, representing a 14% year-on-year growth, coupled with improved net interest income and a significantly better net NPA ratio of 0.19%.
- July 25, 2025: The bank’s Board approved the 1:5 bonus share issue ratio and officially set the record date for August 26, 2025, initiating the process for this shareholder benefit.
In terms of stock performance, KVB shares have traded within a range of ₹185.55 (52-week low) to ₹277.50 (52-week high) over the past year. As of August 2025, the share price has been hovering around ₹270 on the BSE, reflecting sustained investor confidence in the bank’s consistent performance and strategic initiatives.
In conclusion, Karur Vysya Bank’s 1:5 bonus share announcement is a significant and positive development for its shareholders, enhancing liquidity and reflecting the bank’s robust financial health. Coupled with strong Q1 FY26 results and a history of consistently rewarding investors, the outlook for KVB appears stable and promising. This strategic move aims to benefit long-term investors by increasing their share count without dilution of proportional ownership, reinforcing KVB’s position as a reliable investment.
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