First1:2 Stock Split, 1:1 Bonus Issue By This Dairy Stock, Record Date August 13: All-Time Returns At 1,539%

Dairy products maker, Milkfoods is a penny stock which is scheduled to split and reward bonus issue for the first time. Milkfoods will be in focus in the coming days as the company will turn ex-bonus and ex-split on August 13. Milkfoods is a multi-bagger with all-time gains of 1,539.30%.

Milkfoods has journeyed from Rs 25 levels from October 1996 to near Rs 705 levels on August 2, 2024. Last week, the stock broadly gained by over 2.3%. YTD, the stock has zoomed by over 16.2% on BSE.

The stock is currently at Rs 704.60 apiece with a market cap of Rs 429.42 crore. The penny stock's 52-week high and low are at Rs 824.45 apiece and Rs 490 apiece respectively.

As per BSE data, the stock's price-to-equity ratio is at 64.77x and its return on equity is at 4.81%.

Milk foods Stock Split:

The company will split in the ratio of 1:5 on the record date of August 13, which is set to determine eligible shareholders. The ratio means that 1 equity share of Milkfood with a face value of Rs 10 will be split into two shares with a face value of Rs 5 each.

This is the first stock split by Milkfood. And only those investors will be eligible who are holding Milkfood shares by August 13.

Generally, share splits mean that listed companies can split their existing shares into a ratio decided by them for a host of reasons. These could be done to improve liquidity, lessen the value of the stock, make it cheaper or simply attract new buying from both existing and new investors.

Milkfoods Bonus Issue:

After stock split, on August 13, Milkfood stock will turn ex-bonus for its bonus issue ratio of 1:1. Simply put, the company will allot 1 bonus share on 1 existing equity share.

Here as well, only those investors will be eligible who are holding Milkfood shares by end of record date aka August 13.

Bonus shares are one of the many corporate actions that listed companies announce on several occasions. Bonus shares are like incentives which are free of cost given to investors. Under this corporate action, new shares are issued at the existing Face Value of equity shares of the company. Hence, the face value remains the same post-bonus issue.

How investors shares will be multiplied?

For example: If you're holding 500 shares of Milkfood by end of August 13, then you will be eligible for the two rewards.

Stock Split Ratio: At 1:2 ratio, 500 shares will multiply to 1,000 shares (500 X 2).

Bonus Issue Ratio: Then 1,000 shares will receive another 1,000 shares as bonus, taking the total to 2,000 shares.

However, the price value of Milkfood will be reduced as well, adjusting to stock split and bonus issue ratio.

About Milkfoods:

Incorporated in 1973, Milkfood Limited is located in Patiala, at the heart of a milk producing region. State-of-the-art facilities, high capacity machinery are just a few of the things we are proud of. While Milk Powders and Pure Ghee are its core products, and the company also deals in high-end Casein and Demineralized Whey Powder.