Shares of NMDC, a public sector mining giant, are expected to attract attention this week.
The company’s board has approved issuing bonus shares in a 2:1 ratio, meaning shareholders will receive two additional shares for every one share they own.
The record date for this issuance is set for 27th December, so investors need to hold NMDC shares before this date to qualify for the bonus shares.
This is the first time in 16 years that NMDC is offering bonus shares. On Tuesday, the share price stood at ₹212.60, while the stock market is closed today for Christmas celebrations.
What Are Bonus Shares?
Bonus shares are free additional shares given to existing shareholders in proportion to their current holdings.
For example, if a shareholder owns one share, they will receive two bonus shares under the 2:1 ratio.
These shares are issued from the company’s retained earnings as an alternative to paying dividends, providing shareholders with extra equity at no cost.
NMDC Posts Strong Financial Performance
NMDC showed impressive results in the July-September quarter of the current fiscal year.
The company reported a 16.66% rise in consolidated net profit, reaching ₹1,195.63 crore, compared to ₹1,024.86 crore in the same quarter last year.
Additionally, its total income grew by 22%, reaching ₹5,279.68 crore, compared to ₹4,335.02 crore in the corresponding quarter of the previous fiscal year.
As India’s largest iron ore mining company, NMDC operates under the Ministry of Steel and contributes nearly 20% of the country’s iron ore supply, a critical component for steel production.
Total income also saw a significant rise of 22%, climbing to ₹5,279.68 crore from ₹4,335.02 crore in the previous year’s corresponding quarter.
