1:1 Stock Split, Bonus Issue: This NBFC Announces Free Shares Following Healthy Q3 Results

Capri Global Capital Ltd, a prominent non-banking financial institution, has recently greenlit a bonus issue of shares and an equity split following its robust performance in the December quarter.

The company has declared a bonus issue of shares in a 1:1 ratio, marking the first instance of such an action by Capri Global Capital. Shareholders are set to receive a complimentary share for every share they currently hold, the record date for which is yet to be finalized. The funds for this bonus issue, totalling Rs 41.24 crore, will be sourced from the balance in the securities premium account, which stood at Rs 188.3 crore as of March 31, 2023.

The bonus issue is expected to enhance shareholder value and is viewed as a strategic manoeuvre to reward existing investors for their loyalty. Shareholders eagerly anticipate the announcement of the record date to determine their eligibility for the bonus shares.

In addition to the bonus shares, the board has also given the nod for a stock split. One share, with a face value of Rs 2 each, will be split into two shares with a face value of Rs 1 each. This decision follows the company's last stock split in November 2016 when one share of Rs 10 was divided into five shares of Rs 2 each. The move aims to make the shares more accessible to a wider range of investors and improve liquidity in the market.

Capri Global Capital's financial performance in the December quarter has further fueled investor confidence. The company reported a remarkable 54% surge in Assets Under Management (AUM), reaching Rs 13,362 crore. Disbursements nearly doubled, rising by an impressive 91% compared to the same quarter last year. On a sequential basis, AUM witnessed an 8.1% growth, while disbursements rose by 6.9%.

Despite the substantial growth, the company is struggling to manage its asset quality effectively. Gross Stage 3 assets marginally increased to 2.1%, up from 1.9% in the September quarter. The Provision Coverage Ratio on stage 3 assets also witnessed an improvement, standing at 34.7% compared to 32.2% in September. These figures reflect the company's prudent risk management strategies and commitment to maintaining a robust loan portfolio.

The positive financial results have translated into a bullish market sentiment, with Capri Global Capital shares trading with gains of nearly 5% at Rs 983.60 per share on the National Stock Exchange (NSE) as of 9:25 am. The stock closed 3.7% higher on Thursday at Rs 990 per share, marking a 40% surge over the last 12 months.

Investors and market analysts are optimistic about the company's future prospects, considering its proactive measures to reward shareholders and the continued upward trajectory in financial performance. The bonus issue and stock split, coupled with the healthy Q3 results, position Capri Global Capital as a promising player in the non-banking financial sector space.