Özet:

An attempt is made to gauge the reaction of the announcement of bonus,on the market price of equities, in terms of its effect on returns inIndian environment.The impact is captured for 61 days (-30 0 +30) event window. Present study consists of123 selected bonus announcements, relevant to the companies, listed on National Stock Exchange. The selected announcements are spread across 13 years ranging from 1st April 2006 to 31st March 2019. Event study methodology is used with market model. Cross sectional AAR is calculated and are tested for the entire event period. In addition 30 days pre & 30 days post announcement day, effects are also observed. Besides, CAAR- Cumulative Average abnormal return is tested for examining the cumulative effect.The study reveals that the AAR reaches the peak on the announcement day. The results of T statistics at 5% LOS provide adequate confirmation of significant positive AAR, clustered on and the days surrounding the event day thereby rejecting the null hypothesis at 5% LOS.Strong rejection at 1%LOS is observed on D-2, D-1& D0 days. The cumulative average abnormal returns (CAAR) take off from the days before the announcement with a gradual rise, to reach the peak on the D+1 day and further a decline in the immediate post event window is noticed. 14significantCAAR is observed at 5%LOS with presence of strong rejection at 1%LOS for 8 CAAR.Paired T test result showed strong rejection as significant difference of AAR at 1% in 30 day’s pre-and 30 days postannouncement day is discovered.Overall, it can be said that the selected bonus announcements create a significant impact on the equity shares market price around the event window. Hence, it sounds reasonable to conclude that the bonus announcement is viewed as a positive action by the market & thereby, these freebies offer an opportunity for wealth creation

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