Consumer Discretionary Stock Declares Big Update On 1:1 Bonus Shares Allotment: Buy?

Small-cap company Advani Hotels & Resorts (India) Ltd operates in the consumer discretionary industry. India is home to Advani Hotels & Resorts (India) Limited. Through its Caravela Beach Resort in South Goa, the company principally operates in the hotel industry. The proposal to issue fully paid bonus equity shares at par in the proportion of one equity share against one equity share already held by the members, whose names appear in the Depositories' records as of record date, was discussed by the Board of Directors of the Company at their meeting on January 29, 2024. On March 5, 2024, the firm released an important update on the same, putting the stock in the spotlight for market observers. Renowned businessman and investor Radhakishan Damani held 19,30,009 equity shares of the firm in his portfolio as of the BSE statistics for the quarter that ended on December 31, 2023, accounting for 4.18% of the total fully paid-up share capital.

Advani Hotels & Resorts Bonus Shares Update

"Pursuant to Regulation 30 read with Schedule Il of SEBI (LODR) Regulations, 2015, please find enclosed herewith copy of letter dated March 2, 2024, dispatched on March 5, 2024, to the Shareholders holding Shares in physical mode, requesting them to provide their demat account details to the Company's Registrar & Transfer Agents M/s Datamatics Business Solutions Ltd, for the purpose of crediting Bonus Equity Shares, as the same shall be allotted in demat mode only. The Exchanges are requested to kindly take the same on record," said the company in a stock exchange filing on Tuesday.

The company has asked shareholders in order to provide their demat account details for the purpose of crediting the bonus shares. Regarding the same, Advani Hotels & Resorts said in a regulatory filing on 2nd March 2024 that "This is with reference to the Postal Ballot Notice dated January 29, 2024 issued by the Company ['Advani Hotels & Resorts (India) Limited] seeking approval of the Members by way of an Ordinary Resolution for the Issue of Bonus Shares. In this regard, we wish to inform you that the Securities and Exchange Board of India ('SEBI'), vide its Circular No. SEBI/LAD- NRO/GN/2023/130 dated 23 May 2023 amended the provisions of Chapter XI of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 by inserting Regulation 294(6), wherein the allotment of Shares in a Bonus Issue shall be made only in the dematerialized form."

In compliance with the above provisions, the Bonus Shares would be allotted to the Shareholders in demat mode only. Accordingly, the Shareholders holding the Shares in physical mode are requested to provide their demat account number to the Company / Datamatics Business Solutions Ltd., [Company's Registrar and Transfer Agents ('RTA")], so as to credit the Bonus Shares to the demat account. In this connection, the Shareholders holding Shares in physical mode are requested to submit the following documents:

Request letter for credit of Bonus Shares in demat account;

• Form ISR-1;
• Form ISR-2;
• Self-attested copy of PAN;
• Self-attested copy of Aadhaar / any other Government Issued Address Proof; and
• Client Master List duly attested by your Depository Participant.

The said forms can be downloaded from the websites of the Company on the link https://www.caravelabeachresortgoa.com/investor-relations/investor-information.htm! or the 'RTA' by clicking on the link https://www.datamaticsbpm.com/registrar-and-transfer-agent/information-to-shareholders/. You are requested to send the aforesaid documents to the Company / 'RTA' M/s Datamatics Business Solutions Ltd. Plot No. B- 5, Part B Cross Lane, MIDC, Andheri (East), Mumbai 400 093 on or before Tuesday, March 19, 2024.

In case of non-receipt of the documents by the Company / RTA on or before the prescribed date, the respective Bonus Shares shall be credited to a Suspense Escrow Demat Account or shall be dealt with as may be specified by the Stock Exchanges or any other relevant authority. Thereafter, the respective Shareholders may claim their Bonus Shares from the said account through the Company / RTA. Shareholders seeking further clarification / information in this matter, may please contact the Company / RTA by sending an email to [email protected] / [email protected] respectively by mentioning their name and Folio number."

Advani Hotels & Resorts Bonus Shares News

"Pursuant to Section 63 and other applicable provisions of the Companies Act, 2013 and all other applicable laws and regulations, a sum of Rs 9,24,38,500 standing to the credit of the Free Reserves as per the audited Balance Sheet of the Company as on March 31, 2023 forming a portion of the undistributed profit of the Company, be capitalised and that the amount so capitalised be applied fully in paying up in full at par 4,62,19,250 new Equity Shares, having a face value of Rs 2/- each (hereinafter referred to as a "Bonus Shares") in the share capital of the Company and that the said Bonus Shares be appropriated by way of capital and not as income and allotted and distributed as fully paid Bonus Shares to those members whose names appear in the records of the Company's Depositories as the holders of the existing Equity Shares on such date (hereinafter referred to as "the Record Date") as may be hereinafter determined by the Board of Directors in the proportion of one Equity Share fully paid up against one Equity Share fully paid up held by such persons respectively provided that the issue and allotment of the said Bonus Shares shall be subject to the following terms and conditions:

a)the receipt of approvals, if any, as may be necessary from the Securities and Exchange Board of India (SEBI) and/or the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) in which the Company's existing Equity Shares are listed for trading.

b) that the necessary approval of the Reserve Bank of India, if any, is obtained under the Foreign Exchange Management Act, 1999 and subsequent amendments, if any, thereto, for the issue and allotment of the Bonus Shares to those members of the Company who are the residents outside India as on the "Record Date".

c) that the said Bonus Shares shall, in all respects, rank pari passu with the existing Equity Shares of the Company except they shall be entitled to participate only in such dividends as may be declared subsequent to the allotment of the Bonus Shares and that they shall not be entitled to participate in the dividend that may be declared in respect of the financial year or for any period prior to the allotment of the said Bonus Shares. The said Bonus Shares shall also be subject in all respects to the provisions of the Company's Memorandum and Articles of Association.

d)that no letters of allotment shall be issued to the allottees of the said Bonus Shares and the Bonus Shares allotted shall be credited into the Demat Account of the Allottee(s) as maintained with the Depositories within the prescribed time limit statutorily applicable from the date of allotment.

e)for the purpose of enabling the Board of Directors to implement the resolution, the Board of Directors be and are hereby authorised to do the following acts:

i) to negotiate with the relevant statutory authorities and to settle with them any questions or difficulties that may arise in connection with the issue of the Bonus Shares in such manner as the Board may deem appropriate and that the Board of Directors may agree to any condition(s) as may be imposed by the above Authorities in connection with the said Bonus issue and generally to give such directions, execute such documents or writings as necessary and take such action as may be considered appropriate in respect of the above issue and the allotment / distribution of shares thereof.

ii) without prejudice to the generality of the foregoing provisions, in particular to make, if so, required by the terms of sanction of the concerned statutory authorities or any of them, such consequential changes in the quantum and proportion of the said Bonus Shares, as they may consider fit, and in case the requisite approval from the requisite authority or any of them cannot be obtained for the issue of the said Bonus Shares and / or the allotment / distribution thereof to any of the Shareholders, in that event, the issue of the said Bonus Shares shall stand rescinded," said Advani Hotels & Resorts in a regulatory statement dated February 7, 2024.

"The Board of Directors of the Company at their meeting held on January 29, 2024 considered the proposal for the issue of fully paid Bonus Equity Shares at par in the proportion of one Equity Share against one Equity Share already held by the members, whose names appear in the records of the Depositories as on the date to be determined by the Board ("Record Date") consequent upon receipt of approval from the Shareholders to the above proposal by way of an Ordinary Resolution. The Company has been performing consistently well for the last few years and the Board of Directors have, therefore, considered it appropriate to reward the Shareholders by capitalising a portion of the undistributed profits standing to the credit of the Free Reserves," the company further stated.

Advani Hotels & Resorts Share Price Target

Deven Mehata - Equity Research Analyst at Choice Broking said ADVANIHOTR is currently trading at 155.30 levels, having undergone a correction from its all-time high of 175. Positioned above crucial support at 145, adjacent to its 50-day Exponential Moving Average (EMA), the stock demonstrates resilience.

While presently trading above its medium-term (50-day) and long-term (200-day) EMAs, it trails below its short-term (20-day) EMA. For investors with existing holdings, a prudent strategy involves booking partial profits and maintaining the remaining quantity with a trailing stop loss set at 144, just below robust support levels.

Prospective investors are advised to exercise patience, awaiting a reversal in the stock's trend. Fresh entries can be considered either on market dips around 150 levels with a strict stop loss at 144 or upon breaching the resistance at 162, in proximity to the 20-day EMA, with the same stop loss, targeting a move towards 175 and beyond. This comprehensive approach incorporates key support levels, moving averages, and strategic entry points for informed decision-making in ADVANIHOTR.