The Board of Directors had recommended the issue of bonus shares to the shareholders of the company in the ratio of 1:3, that is one bonus equity share of Rs 10- each fully paid up for every three existing equity shares of Rs 10 each paid-up to the eligible members, REC said in an exchange filing. The record date was fixed as Thursday, Aug 18, 2022.
The investors, who will have the delivery of shares as of the given record date, will be eligible for the issue of bonus shares and the stock trades ex-bonus a day earlier.
Following the update, shares of REC rallied 3 per cent to Rs 106.05 on Wednesday, before giving up its gains marginally. The stock had settled at Rs 103 on an adjusted basis.
Last week, the company received shareholders’ approval for the proposal to issue 65.83 crore bonus shares, utilizing capital reserves of Rs 658.3 crore. Bonus shares are fully paid additional shares issued by a company to its shareholders.
REC is a Navratna company under the administrative control of the Ministry of Power. It funds its business with market borrowings of various maturities, including bonds and term loans apart from foreign borrowings.
State-owned NBFC posted an 8 per cent increase in its consolidated net profit at Rs 2,454 crore for the first quarter ended June 30, on the back of reduced expenses. Though, its total income fell to Rs 9,506 crore in the quarter under review.