Navratna PSU NMDC Ltd announced 2:1 Bonus Issue, Here to know Target Price

This will be the second bonus issue by NMDC, after 16 years. The last time NMDC sanctioned bonus shares to investors was in May 2008, also in the ratio of 2:1.

Navratna PSU NMDC Ltd announced 2:1 Bonus Issue, Here to know Target Price
Navratna PSU NMDC Ltd announced 2:1 Bonus Issue, Here to know Target Price

NMDC Ltd, Navratna PSU metals and minerals company is scheduled to reward investors with 2 free shares on the existing 1 piece. The announcement came 16 years after its last bonus, NMDC has received a SELL rating on its stock from brokerages like Kotak Institutional Equities and Centrum.

Last month, the company increased the prices of iron ore by a whopping 18% through two hikes. This was due to capitalizing on a tight domestic market due to an extended monsoon and logistic challenges in Odisha.

NMDC's prices are at a 48% premium to export parity, much above historic premiums (30%), and at a 10% discount to import parity versus the historic average of 20%.

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NMDC's share price ended at Rs 220.70 per share, up by 1.40% on BSE with a market cap of Rs 64,678.47 crore. The stock's 52-week high and low is at Rs 286.35 apiece and Rs 171.05 apiece respectively. The return on equity is at 22.01%.

The Navratna PSU player has declared the issuance of Bonus Shares to the shareholders of the Company in the ratio of 2:1, i.e. two Bonus Equity Shares of face value Rs 1/- each fully paid up; for every 1 existing equity share of face value of Rs 1/- each fully paid up, to the eligible members of the Company as on the record date, subject to the approval of the Shareholders of the Company.

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This will be the second bonus issue by NMDC, after 16 years. The last time NMDC sanctioned bonus shares to investors was in May 2008, also in the ratio of 2:1.

Read Also : Indraprastha Gas to issue one bonus share for shareholders