Shares of NMDC Ltd, India’s largest iron ore producer, began trading ex-bonus on December 27, 2024, as the company moves forward with its plan to issue bonus shares in a 2:1 ratio. This means that for every one share held, shareholders will receive two additional shares. The record date for determining eligible shareholders was also set for today.
Share Price Performance
On the opening day of trading ex-bonus, NMDC shares opened at ₹71.84 on the National Stock Exchange (NSE) and quickly touched an intraday high of ₹72.10 shortly after the market opened. However, the stock faced selling pressure as profit booking set in, preventing it from sustaining these higher levels.
Details of the Bonus Share Issuance
In an exchange filing, NMDC announced that it has received approval from both BSE and NSE for the issuance of 586,12,11,700 equity shares at a face value of ₹1 each as bonus shares. The company stated: “We wish to inform you that the Company has received in-principle approval under Regulation 28(1) of SEBI LODR, 2015… for issue and proposed allotment of bonus shares.”
The deemed allotment date for these bonus shares is set for December 30, 2024, and they will be available for trading starting December 31, 2024.
Historical Context
This marks the first time NMDC has issued bonus shares in over 16 years, with the last issuance occurring on May 21, 2008, when they also issued shares in a 2:1 ratio. The current bonus issue is seen as a strategic move to enhance shareholder value and increase liquidity in the stock.
Market Reaction and Recent Performance
Despite the positive news surrounding the bonus issue, NMDC shares have faced challenges recently. The stock has seen a decline of approximately 7% over the past six days leading up to this announcement. Analysts attribute this downturn to broader market concerns and potential impacts from new taxation proposals affecting iron ore mining in Karnataka.
Conclusion
As NMDC begins trading ex-bonus, eligible shareholders can look forward to additional shares that may enhance their investment value. With the upcoming allotment date and trading availability just around the corner, investors are keenly watching how this development will impact NMDC’s stock performance in the coming weeks.
Disclaimer: This article summarizes current events related to NMDC’s bonus share issuance based on available information as of December 27, 2024.
