Rs 30/Share Dividend: Fertilizer Stock Trades Ex-Dividend For 300% Dividend Payout; Do You Own?

Gujarat Narmada Valley Fertilizers & Chemicals stock sees huge movement on Monday as it is trading ex-dividend. The company is set to reward shareholders with a dividend payout to the tune of 300% as part of its long-term growth strategy.

The ex-dividend date is the day when the price of the equity share of the listed company gets adjusted for the dividend payout.

At the time of writing, Gujarat Narmada shares traded at Rs 618.50 apiece, down by 0.6% on BSE. The stock ranged from Rs 623.80 apiece to Rs 615.55 apiece respectively.

As per the regulatory filing, keeping in view the Company's performance for the FY 2022-23, long-term growth strategy and to ensure that the Shareholders get sustained return on their investment, your Directors have recommended a Dividend of Rs 30/- per share (@ 300%) on 15,54,18,783 Equity Shares of 10/- each fully paid up, subject to the approval of Shareholders at the Annual General Meeting.

The dividend payout will work out to Rs 466.26 crore. Notably, this dividend payout will also account for 31.85% of the Net Profit of the company in FY23/

FY23 net profit of Gujarat Narmada stood at Rs 1,463.98 crore. The company's board of directors decided to transfer Rs 500 crore from the profits of FY23 to general reserves.

Gujarat Narmada has a strong record of paying hefty dividends to its shareholders. In FY22, the dividend payout was Rs 10 per share, which was up from Rs 8 dividend per share in FY21.

Further, according to the filing, the Members, whose names appear in the Register of Members/list of Beneficial Owners as of Tuesday, September 19, 2023, i.e. the date before the commencement of book closure, being the cut-off date will be paid the Final Dividend for the financial year ended March 31, 2023, as recommended by the Board, if approved at the AGM, on or after Tuesday, October 3, 2023.

Hence, the stock is turning ex-dividend today.

Gujarat Narmada shares monthly upside is around 15%, while half-yearly gains are over 18% as of now. But so far in 2023, the stock has advanced by a little over 10%.

GNFC started its manufacturing and marketing operations in 1982 with one of the world's largest single-stream ammonia-urea fertilizer complexes and gradually expanded in chemicals. At present, chemicals form a significant segment of revenue and are key contributors to segment results.

In the first quarter of FY24, the company reported total revenue of Rs 1,740 crore versus Rs 2,772 crore in Q1FY23, while EBITDA also dropped to Rs 105 crore as against Rs 763 crore in Q1FY23. Further, PAT plunged to Rs 85 crore as against Rs 569 crore in Q1FY23. Pankaj Joshi, IAS, Managing Director, GNFC stated last month that the Q1FY24 witnessed a planned annual turnaround due to which, both, volume as well as financial performance are not comparable.

In its outlook, the company hopes to improve its margin profile with the annual shutdown at Bharuch complex coupled with stable Dahej operations. Also, the addition of Concentrated Nitric Acid-IV is expected to add up margin improvement.