MM Forgings has declared a bonus issue in a 1:1 ratio, entitling shareholders to one free share for every share they own.
The company will also distribute a high dividend of ₹8 per share next month. The record date for bonus share issuance has been set as July 16, 2024, pending shareholder approval.
Share Performance
Currently, MM Forgings’ shares are trading up by 5% at Rs 1,212 as of today, Thursday. The company’s EBITDA rose to ₹78 crore from ₹69 crore, with an operating profit margin of 20.2% versus 17.7% in the previous year
Company’s Decision
The company revealed its plan to issue bonus shares alongside dividend payment during a recent board meeting.
This marks the third time MM Forgings has issued bonus shares, with previous instances occurring in 2018 and 2008, both in a 1:1 ratio.
Future Outlook
The company’s management anticipates a subdued commercial vehicle market and projects revenues between ₹1,800 crore and ₹2,000 crore in FY25. Margin forecasts suggest an increase to 18% in FY24 and further improvement to 20% in FY25.
March Quarter Results
Financial Performance
In the March quarter, MM Forgings witnessed a significant increase in revenue, rising by 2.3% to ₹397 crore compared to the previous year’s ₹388 crore.
EBITDA also saw growth, reaching ₹78 crore from ₹69 crore year-on-year. Operating profit margin expanded to 20.2% in the March quarter, up from 17.7% in the previous year.
Annual Performance
For the fiscal year 2023-24, MM Forgings recorded a revenue growth of 9%, reaching ₹1,553 crore compared to ₹1,430 crore in the previous fiscal year.
EBITDA grew by 14% to ₹314 crore from ₹275 crore, with the operating profit margin improving to 20.2% from 19.2% in FY23.
The company’s profit after tax increased by 15% to ₹145 crore from ₹126 crore in the last fiscal year.The operating profit margin improved to 20.2% from 19.2% in the previous fiscal year. Profit after tax surged to ₹145 crore from ₹126 crore.
Management Outlook
Market Forecast
The management anticipates a sluggish commercial vehicle market and projects revenues between ₹1,800 crore and ₹2,000 crore for FY25.
Margin Expectation
They also forecast margins to reach 18% in FY24 and rise to 20% in FY25.
