Bengaluru, Aug. 17 -- A bonus share is a free additional share given to existing shareholders, usually in proportion to the number of shares they already own. Companies issue bonus shares as a way to distribute accumulated profits to shareholders without paying out cash. For example, a 1:1 bonus issue means that for every share a shareholder owns, they receive one additional share.

A stock split is when a company divides its existing shares into multiple shares, increasing the number of shares in circulation but without changing the overall value of the investment. For example, in a 1:2 stock split, one equity share is divided into two equity shares; therefore, the halved. This makes the shares more affordable, without affecting the over...