The share price of Indian Metals & Ferro Alloys was up 3% intraday on 26th November to Rs 814.10 after the firm’s board of directors approved the issuance of bonus shares.
At their meeting on 26th November 2021, the board of directors of Indian Metals & Ferro Alloys approved the issue of bonus equity shares in the ratio of one new equity bonus share of Rs 10 for every existing share of Rs 10 held by shareholders on the record date, subject to shareholder approval.
The record date for determining the eligibility of shareholders entitled to bonus shares has been set for January 10, 2022. The board also agreed to raise the company’s permitted share capital from Rs 38,75,00,000 to Rs 63,50,00,000. Indian Metals & Ferro Alloys was trading at Rs 796.55 on the BSE at 11:57 a.m., up to Rs 9.30, or 1.18 percent.
On August 2, 2021, the stock reached a 52-week high of Rs 997 and a 52-week low of Rs 253.85 on December 22, 2020. It is currently trading 20.11 percent lower than its 52-week high and 213.79 percent higher than its 52-week low.
Bonus Shares Will Be Issued In A 1:1 Ratio
Indian Metals and Ferro Alloys announced on Friday that its board of directors had approved the issue of bonus shares in a 1:1 ratio at its meeting. The record date for determining the eligibility of shareholders entitled to receive the aforementioned bonus equity shares has been set for Monday, January 10, 2022. In early trading, shares of Indian Metals were over 1% higher.
“Issuance of Bonus Equity Shares in the ratio of 1 new Equity Bonus Share of Rs.10/- each for every 1 existing Equity Shares of Rs. 10/- each held by the shareholders of the Company as on the Record Date, subject to the approval of shareholders of the Company through Postal Ballot and other applicable statutory and regulatory approvals,” the company said in a BSE filing today.
Further Key Takeaways
Bonus shares will be granted from the company’s allowable reserves as of March 31, 2021, according to Indian Metals. The corporation had stated earlier this week that it will have a meeting with the board of directors on November 25 to discuss the proposal to issue bonus shares.
IMFA is India’s largest seamless integration manufacturer of value created ferrochrome, with a capacity of 2.84 lakh tonnes per year with offices in Bhubaneswar. The stock of Indian Metals has gained over 175% this year.
Frequently Asked Questions (FAQs)
Q1. What does it mean to have bonus shares?
Bonus shares are free extra units given to existing owners depending on the number of shares they possess. For example, if Investor A owns 200 shares of a corporation and the company declares a 4:1 incentive, he will receive four additional shares for free.
Q2. Is a bonus share beneficial to investors?
Since bonus shares increase the company’s issued share capital, it seems to be larger than it is, which makes it more desirable to shareholders. Furthermore, increasing the number of outstanding shares lowers the stock price, making it more accessible to individual investors.
Q3. What kind of people is eligible for bonus shares?
The corporation will issue bonus shares to all shareholders who have shares in their Demat account on the record date. The record date is one day earlier than the ex-date. To be eligible for bonus shares, an investor must purchase the shares at least one day before the ex-date.