The plain answer
Corporate actions reach you through two pipes: cash lands in your bank account, securities land in your demat account. Dividends credit to the linked bank; bonus shares and splits credit to the demat automatically. The demat account's role in every case is the same: it is the record that proves you held the shares on the relevant date, and the depository executes the credit or debit on the schedule the company announced.
Every action runs on a small set of dates that the company fixes and announces through the exchanges: the record date, the ex-date and the payment or credit date. You do not need to do anything for the automatic actions, a dividend, a bonus or a split. You need to act, within a deadline, for the optional ones: a rights issue subscription or a buyback tender. This page covers the mechanics of all of them, not the decision to participate.
The action types
| Action | What happens | Where it shows | Do you act? |
|---|---|---|---|
| Dividend | Cash paid per share | Linked bank account | No, automatic |
| Bonus issue | Free shares added | Demat account | No, automatic |
| Split | Face value reduced, shares multiplied | Demat account | No, automatic |
| Rights issue | An offer to buy more shares at a set price | App, with a deadline | Yes, within the offer window |
| Buyback | Company buys back shares at a set price | Cash to bank after tender | Yes, tender within the window |
The automatic three are bookkeeping events in the depository: the company fixes the dates, the depository moves the securities or instructs the payment, and your statements update. The optional two are offers with windows, and ignoring the window is itself a decision, one that usually means the entitlement lapses without value. The dates section below explains the timetable both kinds share.
The dates that decide everything
The record date is the hinge. It is the date the company fixes to determine which shareholders are entitled, and your name must be in the depository's records as a beneficial owner of the shares as on that date. SEBI's listing rules make the record date a formal event: the company must intimate it to the exchanges at least 7 working days in advance, and a listed company must keep at least 30 days between two record dates, which is why corporate actions on a stock never crowd each other.
Around the record date sit two other dates. The ex-date is the trading-side cut-off: a purchase on or after the ex-date settles after the record date, so the benefit stays with the seller, and the share price typically adjusts for the benefit leaving the stock. The payment or credit date is when the action actually lands: cash to the bank for dividends and buybacks, securities to the demat for bonus shares and splits. The dividend rule adds one more constraint: the dividend must be declared or recommended at least 5 working days before the record date.
| Date | What it decides | Your position |
|---|---|---|
| Announcement date | The board declares the action and fixes the dates | Nothing yet, just read |
| Ex-date | Trades from this date carry no entitlement | Sell before and you keep the benefit; buy on or after and you do not get it |
| Record date | The official cut-off for the register of holders | Shares must sit in your demat as on this date |
| Credit or payment date | The action lands | Check the bank statement or the demat holding |
The practical reading is short: to be entitled, your shares must be in the demat on the record date, which in trading terms means bought before the ex-date and held through it. Nothing about your activity between the record date and the payment date changes your entitlement: sell after the record date and you still receive the dividend or the bonus, because the register snapshot is taken at the record date.
Dividends: bank, not demat
A dividend is cash, and cash never sits in the demat account. The registrar pays it to your linked bank account through the payment system, using the demat record to establish that you held on the record date. The demat account shows the corporate action notice; the bank statement shows the money. The company must pay a declared dividend within 30 days of declaration under the Companies Act, and most credits land well inside that window.
Two side rules travel with every dividend. The first is TDS: a company deducts 10 percent tax at source on your dividends from it once they cross ₹10,000 in a financial year, with a 20 percent rate if your PAN is not on record. The second is the unclaimed trail: a dividend that stays unpaid or unclaimed for 30 days moves to the company's unpaid dividend account, and after 7 years there it transfers to the Investor Education and Protection Fund. Both rules reward one habit: keep the bank mandate and PAN current on the account.
If a dividend is missing, the check starts with the bank mandate and the registrar's records, not the demat ledger. Confirm the linked bank account on the demat account is the one you use, confirm the record date against your holding history, and then raise it with the registrar, whose details the company publishes in the announcement. The demat's job ended at the record date; the payment pipe is the registrar's.
Bonus and splits: demat credits
Bonus shares and splits are securities events, and they credit to the demat account automatically on the prescribed dates. A 1:1 bonus doubles your quantity: 100 shares become 200. A 1:2 split also doubles it, through a different mechanism: the face value halves and every share becomes two. The mechanics differ, the ledger effect on your quantity can look identical, and the difference matters for tax.
In both cases the share price adjusts on the same schedule, so the total position value is unchanged at the moment of credit. A holding of 100 shares at ₹500 worth ₹50,000 becomes, after a 1:1 bonus, 200 shares at ₹250, still worth ₹50,000. What changes is the cost basis. Bonus shares are allotted at nil cost, so the acquisition cost of the original holding spreads over the larger quantity; a split simply re-denominates, with the total cost unchanged. Your broker's app and the tax statements reflect both, and a sale later is where the two paths diverge.
The holding quantity in the app and the CAS both update, and the ISIN stays the same, because the security has not changed. The credit usually appears on the credit date the company announced, with the depository processing it automatically; no TPIN, no acceptance, nothing to do. The one thing to check is the quantity on the next CAS against the announced ratio, because an error in a corporate action credit is exactly the kind of discrepancy the monthly statement exists to catch.
| Item | Bonus issue | Split |
|---|---|---|
| What arrives | Free shares added to the holding | The same holding re-denominated into more shares |
| Face value | Unchanged | Reduced in the split ratio |
| Position value at credit | Unchanged, price adjusts proportionally | Unchanged, price adjusts proportionally |
| Cost basis | Bonus shares carry nil cost | Total cost unchanged, per-share cost divides |
| ISIN | Unchanged | Unchanged |
Rights and buybacks
Rights and buybacks are offers with windows, and the window is the only hard fact. A rights issue offers existing holders the chance to subscribe to new shares at a set price. The offer stays open for at least 15 days and at most 30 days under the Companies Act, and the letter of offer must reach holders at least 3 days before the issue opens. Ignoring the offer means the entitlement lapses, unless you renounce it, which the law permits unless the articles say otherwise.
On the exchange, rights entitlements trade: the entitlement itself lists and can be sold during the trading window, which is the mechanism that gives an ignored offer a market value instead of a silent lapse. Whether to subscribe, renounce or sell the entitlement is an investment decision. The mechanics you control are the deadline and the payment, both of which the offer document states.
A buyback through the tender route invites holders to offer shares back at a set price. The tender window stays open for 10 working days under the SEBI buyback regulations, the company verifies the offers received, and payment for accepted shares must reach the shareholders within 7 working days of the offer closing. Acceptance can be proportional when shareholders tender more than the company buys, which is the standard outcome in popular buybacks: you may get some, not all, of the tendered quantity accepted.
| Item | Rights issue | Buyback tender |
|---|---|---|
| What is offered | New shares at a set price | A price at which the company will buy back |
| Window | 15 to 30 days, offer document at least 3 days before | 10 working days |
| If you ignore it | Entitlement lapses unless renounced or sold | Shares stay with you |
| If you accept | You pay, shares credit to the demat | Tendered shares debit from the demat, cash credits to the bank |
| Settlement | Allotment after closure | Payment within 7 working days of closure |
How to verify an action landed
Every corporate action leaves two records: the broker app shows the announcement and its effect on your holding, and the depository records the credit or debit in the CAS. Checking one against the other is the entire verification routine, and it takes minutes on the next monthly statement. For cash actions the bank statement is the third record: the dividend or buyback credit should appear there on or after the payment date.
| Action | Where to verify | What to check |
|---|---|---|
| Dividend | Bank statement | Credit on or after the payment date, net of TDS where applicable |
| Bonus issue | CAS and app | Quantity up by the announced ratio on the credit date |
| Split | CAS and app | New quantity, same ISIN, adjusted cost basis |
| Rights issue | App and offer document | Entitlement visible during the window; allotment after closure |
| Buyback | Bank statement and CAS | Cash credit within 7 working days of closure; accepted quantity debited |
The check is worth doing on the credit date, not months later. Discrepancies in corporate action credits are rare but real, and they are fixed fastest while the action is fresh: raise it with the broker first, and with the registrar or company where the payment pipe is involved. The records you checked are also the records tax filing needs, since dividends are income at your slab and bonus shares alter the cost basis of the holding.
What people usually get wrong
Dividends land in the demat account
Cash goes to the linked bank account. The demat account holds securities, and its role is the record of your entitlement on the record date.
A bonus issue makes my portfolio worth more
The quantity rises and the price adjusts proportionally. The position value is unchanged at the credit; what happens afterwards is the market's business.
A split changes the ISIN
Splits change quantity and face value, not the security. The ISIN stays, which is why the CAS shows one code with a new quantity.
Buying before the record date is enough
A purchase on or after the ex-date settles after the record date and carries no entitlement. The ex-date is the practical cut-off, the record date is the legal one.
Ignoring a rights offer costs me nothing
The entitlement can lapse without value if ignored. Renouncing or selling the entitlement on the exchange is the alternative to subscribing, and both have deadlines.
Questions people ask
No. Dividends credit to your linked bank account through the registrar, not to the demat account, because the demat account holds securities, not cash. The demat account's role is to establish that you held the shares on the record date. If a dividend is missing, the check starts with the bank mandate and the registrar's records, not the demat ledger.
The bonus shares credit to your demat account automatically on the prescribed date, and your holding quantity rises. The share price adjusts proportionally on the same schedule, so the total value of your position stays the same at the moment of the credit. The acquisition cost of the bonus shares is treated as nil, which matters later when you sell.
No. A split changes the share's face value and quantity, not the security itself, so the ISIN stays unchanged. The same holding, more shares, one code. The CAS shows one line with a new quantity, and brokers typically update the cost basis so the average price per share halves or divides by the split ratio.
The record date is the date the company fixes to decide who is entitled: the shares must sit in your demat as on that date. The ex-date is the trading-side cut-off that exchanges apply, so a purchase on or after the ex-date settles too late to make the record and the benefit stays with the seller. Between the two dates, the share price typically adjusts for the benefit leaving the stock.
Yes, through two channels: the broker app shows the announcement and its effect on your holding, and the depository records the credit or debit in your account, visible in the CAS. Company announcements on the exchange website carry the full timetable. The two records let you verify that the action landed correctly.
A declared dividend must be paid within 30 days of declaration under the Companies Act, and most companies credit well inside that window once the record date passes. The payment runs through the registrar into your linked bank account via electronic transfer. If 30 days pass with no credit, check the bank mandate on the account and then raise it with the registrar or company.
Sources
- Securities and Exchange Board of India. “SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 — Regulation 42, record date.” Accessed 16 August 2026.
- Ministry of Corporate Affairs. “Companies Act, 2013 — Sections 62, 123, 124 and 125: rights offers, dividend payment and the IEPF.” Accessed 16 August 2026.
- Securities and Exchange Board of India. “SEBI (Buy-back of Securities) Regulations, 2018” — tender window and payment timelines. Accessed 16 August 2026.
- IEPF Authority. “IEPF legislation” — unclaimed dividend transfers. Accessed 16 August 2026.
- NSDL. “Investor Guide” — corporate action processing in the depository. Accessed 16 August 2026.