1:2 Bonus Shares Allotted: Rs. 3.75 Dividend To Be Paid In Due Course; Buy Maharatna PSU Stock?

With a market valuation of Rs 79,630.58 Cr, Oil India Limited, a central public sector company, closed on Friday at a price of Rs 489.55 per share. Following the company's allocation of 1:2 bonus shares, or 54,22,02,597 equity shares at Rs. 10 each, totalling Rs. 5,42,20,25,970, last week, Oil India shares climbed by 2.18%. The record date for the purpose of this corporate action was on 2nd July however Oil India has not stopped rewarding its shareholders yet and its upcoming dividend of Rs. 3.75 is a clear example for which the record date has not been announced yet and the dividend payment will be made in due course.

Oil India Upcoming Dividend

During a regulatory filing, the Board recommended, subject to shareholder approval, a final dividend of Rs. 3.75 per equity share with a face value of Rs. 10/-for the financial year 2023-2024. Following the date of declaration at the AGM, the final dividend would be paid out within 30 days. The interim dividend of Rs. 3.50 and the second interim dividend of Rs. 8.50 paid for the fiscal year 2023-2024 are in addition to the final dividend hence the total dividend for FY24 will be Rs 15.75 per share, for the year ending in March 2024 and the dividend yield at the current share price of Rs 489.55 is 3.22%. The final dividend payment and record date will be determined and announced in due course.

Oil India Bonus Share

"Regarding lssue of Bonus Equity Shares, we hereby inform that Committee of the Board has approved allotment of 54,22,02.597 equity shares of Rs.10/- each as fully paid-up Bonus Equity Shares on Thursday, 04th July,2024 in the proportion of 1:2 i.e. 1 (One) Bonus Equity Share of Rs.10 each for every 2 (Two) existing Equity Shares of Rs.10/- each held, to the eligible Members whose names appear in the Register of Members / list of beneficial owners as on Tuesday,02nd July,2024 [Record Date]," said Oil India in a regulatory filing on 4th July.

The paid-up share capital of the company was 7,08,44,05,194 equity shares of Rs.10 each, amounting to Rs. 10,84,40,51,940 was the pre-allotment of bonus issue while 54,22,02,597 equity shares of Rs.10 each, amounting to Rs. 5,42,20,25,970 was the total size of bonus share allotment. Whereas, the paid up share capital of Oil India post-bonus issue was 1,62,66,07,791 equity shares of Rs 10 each amounting to Rs. 16,26,60,77,910.

"The allotment of Bonus shares is made only in dematerialized form, ln case of members who hold equity shares in physical form and do not have demat account, these Bonus Equity Shares shall be transferred to the "Oil lndia Ltd. Bonus lssue 2024 Physical Shareholders" Demat Account, as per the SEBI Regulations and on submission of requisite documents, such Bonus shares would be transferred to the respective demat account of the members," the company further informed to stock exchanges.

Oil India Share Price Target

Deven Mehata - Equity Research Analyst at Choice Broking said, "OIL, currently trading at 489.50 levels, is showing signs of a positive technical outlook. The stock has given a breakout above 450 levels which will now act as a support level for the stock. Also, the stock is trading above all the important moving averages indicating strength. Notably, the stock has a minor resistance level at 512, which is in proximity to previous all-time high levels. If the stock manages to sustain a position above this mentioned resistance, it may pave the way for an upward movement towards the target level of 550 and beyond. This is a positive development, as it signifies a potential change in the stock's trend."

"The Relative Strength Index (RSI), a momentum indicator, is currently trading at 65.53 levels. This RSI reading suggests a moderate level of strength in the stock, without being in overbought territory. It implies that there is room for the stock to potentially gather further momentum. The overall trend for OIL is sideways to Bullish, supported by various technical indicators, reinforcing the optimistic outlook. Given these signals, there is a possibility for the stock to achieve a target price of 550 in the near term. It is advisable to consider buying on dips, particularly around 475, to capitalize on potential retracements in the stock price. To prudently manage risk, implementing a stop-loss (SL) at 450 is recommended. This precautionary measure is crucial to safeguard investments in the event of an unexpected market reversal," the analyst added.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.