This Midcap Auto Ancillary Stock Has Declared 1:1 Bonus, Check Details Here

Share markets have been volatile as it ended lower on June 14 with BSE Sensex shedding 154 points to close at 52,693 while NSE Nifty was down 42 points at 15,732. Bajaj Auto, Hindalco Industries, ONGC and Tech Mahindra emerged as top loser in today's trade.

While Markets continue their downfall for some time, there is a stock that has declared bonus share. Minda Industries has announced 1:1 bonus. It implies if you have 100 shares of Minda Industries, you will get additional 100 shares after this announcement. Let us find in more detail:

1. Minda Industries declares bonus share and final dividend

The board of directors of Minda Industries Ltd in its filing dated 3/06/2022 said, "The process of approval of Bonus Share of 1 (one) bonus equity share of Rs. 2 each fully paid up for every 1 (one) existing equity share of Rs. 2 each fully paid up (in the ratio of 1:1) as on the "Record Date", is initiated through Postal Ballot Notice, already sent on 27 May, 2022 to those shareholders, who have registered their e-mail ids and the physical dispatch of the postal ballot notice was completed on 28 May, 2022 through registered post for the remaining shareholders, who have not registered their e-mail ids." 

"The final dividend Rs.1 per equity share on the face value of Rs.2/- each i.e. 50% and Rs.0.01 per 0.01% nonconvertible redeemable preference shares for the year ended on 31 March, 2022, is subject to the approval of the shareholders at the ensuing Annual General Meeting of the Company."

Record date: The Record date is July 8

Ex-dividend date: The ex-dividend date is July 7. The ex-bonus date is July 7.

2. What is Bonus Share and how it will benefit you?

A bonus share is defined as an additional share given to the existing shareholder by the company at no extra cost. It occurs when a company cannot pay cash dividends to the shareholders despite registering profitable turnover as a result of likely shortage of liquidity. In such situation, the company issues additional shares in the form of bonus shares. There is a huge benefit of bonus share.

When the company earns good profits, its stock price rises and consequently, the bonus share gives good profits to its shareholders. Also, when dividend is declared, shareholders can get extra return on bonus shares.

3. Stock Outlook of Minda Industries

The current market price of the stock is Rs 875 apiece on NSE with a dip of 2.28% today. The 52-week high of the stock is Rs 1257apiece and 52-week low is Rs 600 apiece. The P/E is 70.36 which is higher than sector P/E of 57.78. The EPS is 12.44.

4. Dividend history

It has great dividend track record and regularly declared dividend in the past 5 years without fail. For the year ending March 31, 2022, the company declared an equity dividend of Rs 1.5 per share. If current market price of the stock is taken into consideration the dividend yield is 0.17%.

5. About Minda Industries Ltd

It is Delhi-based company. It is involved in the manufacturing of lamps, switches, horns for automobiles. It came into existence in 1996 with a public issue of 14.85 lakh shared of Rs 10 each with a premium of Rs 20/share. The market capitalization is Rs 24998 crore at the time of writing the report.