1:1 Bonus Shares Declared: Record Date In Due Course; Bet On The Auto Stock?

As of Tuesday's closing session, Veljan Denison Limited, a small-cap company in the consumer discretionary category, has a market capitalization of Rs 816.73 Cr. Veljan Denison, a subsidiary of the Veljan group, produces custom-built power systems and manifold blocks in addition to pumps, motors, and valves. Veljan Denison is among the multibagger stocks of recent times as the stock has surged around 200% in the last 1 year and on a YTD basis the stock has rallied 85% so far in 2024. However, the stock gained more attraction from market watchers as the Board of Directors announced 1:1 bonus shares. On Tuesday, the stock closed at Rs 3629.90 apiece level. The scrip reached a 52-week-high of Rs 4,200.00 on (28/03/2024) and a 52-week-low of Rs 1,200.10 on (03/04/2023).

Veljan Denison Bonus Shares

The Board of Directors of the company in their meeting held on March 30, 2024, has inter alia approved the "Issue of Bonus Shares to the equity shareholders of the Company in the ratio of 1:1 i.e., 1 (One) new fully paid-up Equity Shares of Rs. 10/- (Rupees Ten only) each for every 1 (One) existing fully paid-up Equity Share of Rs. 10/- (Rupees Ten only) each held by the eligible shareholders as on the Record Date (to be determined by the Board and to be intimated to the Exchanges in due course) upon obtaining approval of the members," as per a stock exchange filing.

22,50,000 equity shares of Rs.10/- each amounting to Rs. 2,25,00,000 are the total number of securities proposed to be issued or the total amount for which the securities will be issued as a part of bonus shares. Bonus shares will be paid out as of September 30, 2023, based on available reserves. The bonus issue would be executed through Rs. 2.25 Cr in share premium and/or available free reserves. A total of Rs. 186.82 crores is available for capitalization as of September 30, 2023.

"The Company will credit the Bonus Shares to the eligible shareholders within 2 months from the date of Board's approval i.e., on or before May 30, 2024," said Veljan Denison in a regulatory filing.

The Board also considered and approved "Increase in Authorised Share Capital of the Company from Rs. 3,00,00,000/- (Rupees Three Crore only) to Rs. 6,00,00,000/- (Rupees Six Crore only) divided into 60,00,000 (Sixty Lacs only) Equity Shares of Rs. 10/- (Rupees Ten only) each and consequent alteration of Capital Clause of the Memorandum of Association of the Company," the regulatory filing further stated.

Veljan Denison News

"Pursuant to Regulations 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, we wish to inform you that the Board of Directors of the Company, based on the recommendation of Nomination and Remuneration Committee, through circular resolution no 01/2023-24 dated March 30, 2024, have approved the appointment of Mr. V.G. Srinivas (DIN: 00181826) as an Additional Non-Executive Director of the Company with effect from March 30, 2024, subject to requisite approvals," said the company in a BSE filing on March 30, 2024.

Veljan Denison Share Price Target

Veljan Denison is bearish and also overbought on the Daily charts with strong resistance at 3986. A Daily close below support of 3418 could lead to a target of 2647 in the near term, said AR Ramachandran from Tips2trades.

Disclaimer

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