Indian Oil recommends issuing free shares; Know the recording date, share ratio, other details

Indian Oil Bonus Stocks: State-owned Indian Oil Corporation Limited (IOC) said it would issue bonus shares to its shareholders at a ratio of 1:2, i.e. for every two existing shares held by investors, a new free share will be issued. The IOC Board of Directors has set next week, Friday July 1, 2022, as the record date to determine the eligibility of shareholders to receive free shares.

The board of the company in its filing said, “The board recommended the issuance of free shares in a ratio of 1:2 i.e. one new free share of Rs. 10/ – each for two existing shares of Rs. 10/- each fully paid subject to shareholder approval by postal vote. The Board set July 1, 2022 as the closing date for the accounts to determine the eligibility of shareholders for free shares.

Indian Oil Corporation Ltd., incorporated in 1959, is a large capitalization company (having a market capitalization of Rs 1,00,119.58 Crore) operating in the oil and gas sector. The main products/revenue segments of Indian Oil Corporation Ltd. include petroleum refinery products, other operating revenue, other services, sale of services, scrap metal and grants for the year ending March 31, 2021.

The state-owned oil marketing company reported revenue of Rs 2,06,461 crore in the quarter under review, compared to Rs 1,63,733 crore recorded in the corresponding quarter of the previous fiscal year.

Final dividend announced

The board had also recommended a final dividend of Rs 3.60 per share having a par value of Rs 10 each (before bonus), which translates to a final dividend of Rs 2.40 per share having a par value of Rs 10 each (after bonus) for the 2021-22 financial year.

The company said in its filing: “The board has recommended a final dividend of Rs. 3.60 per share having a par value of Rs. 10/- each (pre-bonus), resulting in a final dividend of Rs. 2.40 per share having a nominal value of Rs. 10/- each (post-bonus) in respect of the financial year 2021-22, subject to the approval of the shareholders of the Company. The balance of the dividend would be paid within 30 days from the date of declaration at the general meeting. The final dividend is in addition to the interim dividend(s) of Rs. 9.00 per share (pre-bonus) paid for the financial year 2021-22. The record date for the payment of the final dividend would be set and announced in due course.

Share price history

CIO shares are up more than 4% year-on-year, while the stock is down about 5% in 2022 (YTD) so far, compared to an 11% decline in the Sensex benchmark index during such period.

What are the brokers saying?

ICICI Securities has a call to buy on Indian Oil Corporation with a target price of Rs 145. The current market price of Indian Oil Corporation is Rs 106.65. The period given by the analyst is one year when the price of Indian Oil Corporation Ltd. can achieve the set goal.

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Sallie R. Loera