This is the date on which a company closes its books for business after it announces a bonus or dividend. The company's registrar keeps a track of who owns how many shares of that particular company.
Any investor having shares in his/her demat account before this date becomes eligible for the bonus issue or the dividend declared.
Say a company A announces a 1:1 bonus issue and the book closure date is February 28, 2007.
If you don't own this company's share and want to avail of the bonus offer then you must not only buy this share before February 28 but also make sure that the number of shares purchased by you are transferred to your account from the seller before this date.
If the ownership of shares is reflected in your account after February 28 then you will not get any bonus shares. The same is also true for dividend announcements.
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Suppose I buy shares during book closure period. Will I be entitled to get bonus or dividend as the case may be? Please clarify whether shares entitled to receive bonus or dividend, should be bought before the book closure period.
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