SEBI makes declaration of dividend per share mandatory

24 April 2009

The Securities and Exchange Board of India (SEBI) has made it mandatory for companies to declare dividend on per share basis. The market regulator also  prescribed a uniform procedure for dealing with unclaimed shares.

The move, part of the amendments to the equity listing agreement, is expected to clarify the exact returns shareholders get from equities, SEBI said in a release.

The amendments to the listing agreement are intended to enhance disclosures regarding shareholding pattern in a listed company and also to bring more transparency and efficiency in the governance of a listed company, SEBI said in the release.

"It has been decided to mandate that listed companies shall declare their dividend on per share basis only," SEBI said while issuing an amendment. The step is expected to bring uniformity in the manner of declaring dividend amongst listed companies, it added.

Companies now declare dividend as a percentage of face value of the share or in rupee per share, independent of the face value.

''It has been brought to the notice of the board that there is a large quantum of shares issued pursuant to the public issues, which remain unclaimed despite the best efforts of the registrar to issue or issuers,'' it said, adding, there is no uniform practice for dealing with such shares.