In case the company in which a beneficial owner holds shares in demat form announces any corporate benefits like bonus, dividend etc. the beneficial owner will receive the same directly in his demat account or bank account depending on the nature of the benefit.
For payment of dividend etc., the company/registrar takes a list of beneficial owners from NSDL/CDSL as on the record date/book closure date. Based on this list, company makes payment of dividend. If the company is making the payment through ECS, the company will directly credit the dividend to the bank account registered by the beneficial owner with the DP under intimation to the beneficial owner. If the company is making the payment through a cheque/DD, the bank details will be printed on the dividend warrant. The mode of payment of dividend etc is decided by the company itself.
In case of a bonus declaration by a company, the bonus securities on the eligible securities in the beneficial owner's demat account are automatically credited to the beneficial owner's demat account by the company/registrar under an intimation to the beneficial owner. This will be reflected in the transaction statement for the period. In respect of the physical holdings, the customer will receive bonus securities in physical form.
In case of a rights issue, the beneficial owner will receive an option to subscribe for the eligible number of securities from the company/registrar. These securities may be in physical form or in electronic form in the customer's demat account. The customer can exercise the same in the normal course. While exercising the option (in respect shares both in physical or electronic form), the customer may mention the demat account in which the securities allotted are to be credited provided the company is available for demat with NSDL/CDSL. Alternatively, the customer can also ask for the securities in physical form.
In case of a merger or acquisition, securities in the beneficial owner's demat account is automatically credited and debited by the company/registrar as per pre-declared ration under anintimation to the beneficial owner. This will be reflected in the transaction statement for the period.