1:5 Stock Split: Record Date In Due Course; Buy The Consumer Discretionary Stock?

As of today's BSE closing session, Kamdhenu Ventures Ltd., a small-cap company in the consumer discretionary category, has left a market valuation of Rs. 1,205 Cr. Kamdhenu Ventures Ltd (KAMOPAINTS) is a trading firm that produces painted products and deals in structural steel and thermomechanically treated (TMT) bars. The company's headquarters are in Gurgaon, Haryana, and it was incorporated in 2019. On Friday, the shares of Kamdhenu Ventures ended 0.29% higher at Rs 191.65 apiece after the Board of Directors considered and declared 1:5 stock split. The small cap paint stock marked a 52-week-high at Rs 245.00 on (24/01/2024) and a 52-week-low of Rs 105.00 on (19/04/2023).

Kamdhenu Ventures Stock Split

"Subject to the statutory approvals including approval of Shareholders of the Company, the Board of Directors have approved the sub-division/ split of equity shares of the Company, such that 1 (One) Equity Share of Rs. 5 (Rupees Five Only) each fully paid up, be sub-divided/split into 5 (Five) Equity Shares having face value of Re. 1 (Rupee One Only) each fully paid up. The Record Date for sub-division/split of existing Equity Shares shall be decided after obtaining requisite approval of the Shareholders of the Company and will be intimated in due course," said Kamdhenu Ventures in a regulatory filing on 3rd April, 2024.

The rationale behind the stock split is to enhance the liquidity of the company's equity shares and to encourage the participation of small investors by making equity shares of the company more affordable to invest, Kamdhenu Ventures informed the Indian stock exchanges.

Kamdhenu Ventures Stock Split Update

"In order to accommodate the Sub-division/split of the Equity Shares as described above, the Board of Directors has approved that the Capital Clause i.e Clause V of the Memorandum of Association of the Company, be substituted in the following manner, subject to the approval of the shareholders: V. The Authorized Share Capital of the Company is Rs. 36,50,00,000 (Rupees Thirty Six Crore and Fifty Lakhs Only) which comprises Rs. 32,00,00,000/- (Rupees Thirty Two Crore) Equity Share Capital divided into 32,00,00,000 (Thirty Two Crore) Equity Shares of Face Value of Re. 1/- (Rupee One Only) each and Rs. 4,50,00,000 (Rupees Four Crore and Fifty lakhs Only) Preference Share Capital divided into 45,00,000 (Forty Five lakhs) Preference Share of Face Value of Rs. 10/- (Rupees Ten Only) each," Kamdhenu Ventures further added in the regulatory filing.

"In order to obtain Shareholder approval for Sub-division/split of Equity Shares of the Company and consequent amendment in the Capital Clause i.e Clause V of the Memorandum of Association, the Board of Directors have approved the Notice of Postal Ballot and the calendar of event which will be filed with the stock exchanges simultaneously with the dispatch of the same to the shareholders in due course of time," the company stated in a stock exchange filing.

Kamdhenu Ventures Share Price Target

"Kamdhenu Ventures Limited (Kamdhenu Paints), an India-based small-cap paint and coating manufacturing company, has been displaying bullish tendencies thanks to its solid financials and market momentum. The stock has delivered 87.42% gains in a year and demonstrates strong business and financial fundamentals, which make it a lucrative pick. However, at present its valuation is significantly higher than its sector, with its PE standing at 170 against the sector PE of 26. Meanwhile, the technical chart hints at a potential dip buying opportunity in the stock currently trading above 20 and 200-day Exponential Moving Average (EMA), making it attractive for swing trading. I am quite bullish on this stock for the mid-term and would recommend swing traders who prefer small-cap stocks to enter at the current price range of Rs. 184-193, with a target of Rs. 200/210/225/240/250 and a stop loss at Rs. 175," said V.L.A. Ambala, a Research Analyst (SEBI Registered), Co-founder - Stock Market Today (SMT).

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.