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    Question

    A pension fund manager observes that a listed company

    has issued a 1:4 bonus share – i.e. 25% bonus credited from reserves. Pre-bonus EPS was ₹40 and reserves were ₹200 crore. Post-issue, what is the adjusted EPS?
    A ₹32 Correct Answer Incorrect Answer
    B ₹40 Correct Answer Incorrect Answer
    C ₹25 Correct Answer Incorrect Answer
    D ₹30 Correct Answer Incorrect Answer
    E ₹35 Correct Answer Incorrect Answer

    Solution

    Bonus increases shares by 25%, diluting EPS. 

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