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February 17, 2008

Master stroke from Anil – Bonus issue of Reliance Power

And here it is Master Stroke from Anil D Ambani. No one would have even thought of that he will come to rescue of the investors who gave his company prestigious moments of fully subscription of entire issue in first minute of opening or largest subscriber and all.

Reliance Power Ltd plans to issue bonus shares to all equity holders other than the founders, hoping to cheer retail investors after the firm's shares tumbled following a record $3 billion IPO.

Company board is scheduled to meet on February 24 to consider issuing bonus shares and/or other measures which it said would effectively reduce the cost of the company's shares.

"This will include a proposal for issuing free bonus shares to all categories of shareholders excluding the promoter group, thereby protecting investors from even short-term losses on their shareholdings," it said.

Reliance Power's shares, which listed on the stock exchange on Feb. 11, had fallen by a quarter but recovered to close 15 percent below the IPO price of 450 rupees a share on Friday, helped by three-day market rally which saw the benchmark index climb 9 per cent.

The downslide in Reliance Power, a unit of the Anil Dhirubhai Ambani group, angered investors who had invested for reaping benefit from it.

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