As I would see, since face value of stock is already Rs,1, there is no other way for promoters to reduce share price (to make it affordable for retail shareholders) than declaring large bonus issue. Also since its relatively new company, it hardly has any “retained earning/reserves” so company will be capitalizing “other equity” which is nothing but securities premium collected during IPO, by converting it into equity, thereby expanding the equity base and (reducing share price). This is my interpretation but I could be wrong.
This is unprecedented in my opinion. But whether it is good or bad, only time will tell.
Discl – I am invested. Position size is less than 1% of my PF.
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