FMCG giant Nestle India has announced its first-ever bonus issue in the ratio of 1:1. The record date is expected to be announced within two months. Public shareholders who will be eligible for the bonus issue will receive 1 free share against their existing 1 share. This will mean that their Nestlé portfolio will double. LIC is among the top public shareholders of Nestle, and it is in for a big win.
Nestle Share Price:
After market hours of June 27, Nestle stock ended at Rs 2457.75 apiece, up by 1.15% on BSE, with a market cap of Rs 2,36,965.73 crore. The stock is trending due to its bonus announcement. During the trading week from June 23 to June 27, Nestle shares zoomed by 3.40% on BSE. This extended its gaining momentum for year-to-date, as the stock rallied by over 13.3%. In the past six months, Nestle zoomed by nearly 14%.
Nestle's price-to-equity ratio stood at 71.49x, while return on equity stood at 83.06%.
Nestle Bonus Issue:
Nestle declared a bonus issue of a 1:1 ratio. The number of securities proposed to be issued as bonus is to the tune of 96,41,57,160 equity shares of face value of ₹1/- each amounting to Rs 96,41,57,160.
It said the bonus equity shares will be issued out of the retained earnings (free reserves) as per the audited financial statements of the Company for the year ended 31st March 2025.
Furthermore, Nestle said that the estimated time frame for bonus issues to be credited is within two months from the date of approval by the Board of Directors, i.e., on or before 25th August 2025. Hence, the record date will be ahead of this scheduled time.
Calculate Nestle Bonus Issue Gains:
The bonus issue of a 1:1 ratio would mean that Nestlé will issue 1 free equity share for every 1 existing equity share to eligible shareholders.
So let's assume you are holding 500 Nestle shares by the end of the record date, which will make you eligible for the bonus benefits. Then you will receive 500 free shares (500 x 1/1), which will be added to your existing 500 shares, taking your total number of shares to 1000. However, the stock price could be adjusted.
According to BSE FAQs, bonus issues are free additional shares given to existing shareholders based on the number of shares owned. Under bonus, the face value remains the same, while the share capital reserves are reduced.
As of March 31, 2025, LIC is among the top public shareholders of Nestle. The largest life insurer has 4,50,33,003 equity shares of 4.67% stake of Nestle. So if these shares are kept till the end of record date, LIC will receive 4,50,33,003 free shares, taking its total to 9,00,66,006 equity shares.
Nestle BUY/SELL Recommendation:
After the bonus issue announcement, the consensus recommendation from 35 analysts for Nestle India Ltd. is HOLD. As per Trendlyne data, from the total, 4 analysts suggest STRONG BUY, and 7 recommend BUY. EPS is expected to grow by 17.4% in FY25. The average target price is at Rs 2426.31, which is hinting at mild 1.3% potential decline ahead.
Nestle Q1 Results FY26:
Nestle India has intimated stock exchanges that the meeting of the Board of Directors of the Company is scheduled on July 24, 2025 ,inter alia, to consider and approve unaudited financial results (standalone and consolidated) of the Company for the first quarter ending 30th June 2025
During FY25, Nestle posted total sales of Rs 20,077.5 crore, while profit from operations stood at 21.5% of Sales. Net profit is at Rs 3,314.5 crore.
Nestle is food and beverages company with notable brands like NESCAFE, Maggi, KitKat, and pet foods like PURINA FELIX and FRISKIES.
About Nestle India:
NESTLÉ India is a subsidiary of NESTLÉ S.A. of Switzerland. With eight factories and a large number of co-packers, Nestlé India is a vibrant Company that provides consumers in India with products of global standards and is committed to long-term sustainable growth and shareholder satisfaction.
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