"We have already intimated to the stock exchange about the company's plan to issue bonus after taking shareholders nod in September," a top company official said.

IOC scrips is likely to soar to Rs 500 before the AGM despite the initial set back due to the Kargil conflict, the official claimed. IOC's scrip was quoted at Rs 416.50 at the National Stock Exchange yesterday.

The board of IOC had decided for a liberal 1:1 (one share for every share held) bonus issue last month.

The bonus, the second after a 2:1 issue in September 1994, will double IOC's paid-up capital from Rs 389.34 crore to Rs 778.68 crore, the official said.Company sources said the AGM would also finalise the audited results of the Fortune 500 navratna company.

The cash rich oil public sector's free reserves and cash surplus of about Rs12,000 crore would come down by about Rs 389 crore due to the bonus issue, the sources said.

IOC is expected hit the domestic market later this year to divest five per cent of government shares, which at present has about 81 per cent stake in the largest oil refining and marketing company in the country.

Less than nine per cent of the IOC shares are being traded in the market as another 10 per cent stake is with its strategic alliance partner Oil and Natural Gas Corporation (ONGC).

IOC had recorded a 30 per cent increase in net profits during 1998-99 at Rs 2,214 crore on a turnover of Rs 69,430 crore.