PC Jewellers Ltd is going to focus on December 16 as it is the last date to buy the stock for being eligible for its first-ever sub-division in the ratio of 1:10. Currently, the stock trades below Rs 175. The jewellery stock is a 2024 multi-bagger with gains of 247.17% year-to-date. At the latest, major banks are likely to invest in PC Jewellers preferential shares issuance, which will be adjusted to stock split ratio on Monday. Is it attractive to buy?
PC Jewellers Share Price:
Last week, on Friday, the stock ended at Rs 174.80 apiece, down by 0.7% on BSE with a market cap of Rs 8,142.88 crore. The stock is near its 52-week high of Rs 186.80 apiece, while multi-fold higher from its 52-week low of Rs 32.27 apiece.
PC Jewellers Preferential Issue:
The company received approval from the board on December 11 to issue 5,17,11,462 (Five Crore Seventeen Lakh Eleven Thousand Four Hundred Sixty-Two Only) equity shares of the face value of ₹ 10/- (Rupees Ten Only ) each, by way of preferential allotment on private placement basis to the Consortium Lenders classified under 'Non‐Promoter, Public Category.
As per the regulatory filing, the proposed allottees in the preferential issue are - SBI, Union Bank of India, Punjab National Bank, Axis Bank, IndusInd Bank, Bank of India, IDBI Bank, Karur Vysya Bank, Indian Overseas Bank, Canara Bank, Indian Bank, Bank of Baroda, IDFC First Bank, and Kotak Mahindra Bank.
PC Jewellers said that the issue price, and quantity of equity shares will be adjusted for sub-division / split of face value of equity shares of the Company from Rs 10/- each share to Rs 1/- each share, i.e. December 16, 2024.
PC Jewellers Stock Split:
PC Jeweller has fixed December 16, 2024, as the record date or the purpose of sub-division / split of equity shares of the Company, such that 1 (One) equity share having face value of ₹ 10 (Rupees Ten Only) each, fully paid-up, be sub-divided / split into 10 (Ten) equity shares having face value of ₹ 1 (Rupee One Only) each.
Hence, the stock split ratio is 1:10 ratio. This is the first-ever stock split by PC Jeweller.
Generally, share splits mean that listed companies can split their existing shares into a ratio decided by them for a host of reasons. These could be done to improve liquidity, lessen the value of the stock, make it cheaper or simply attract new buying from both existing and new investors.
PC Jewellers Fundamentals:
Technicals: As per Trendlyne data, the stock has surpassed its 100-day, 150-day and 200-day SMAs, while slightly below the 5-day SMA of Rs 176.6. Further, the stock's RSI and MFI are at 59.9 and 59.8 respectively, which is steady since the two indicators below 30 are considered oversold and above 70 overbought. Further, PC Jeweller is trading above 7 out of 8 SMAs, while trading above 5 out of 9 Oscillators in a bullish zone.
Fundamentals: Stock Price rose 421.47% and outperformed its sector by 375.16% in the past year; while Mutual Fund Holding remained the same in the last quarter at 0%, and Promoter Pledges are zero. However, its Debt to debt-equity ratio of 1.39 is higher than 1, which implies that company assets are financed through debt; Price Earning Ratio is 614.01, higher than its sector PE ratio of 70.67; and Return on Equity(ROE) for the last financial year was -21.46%, less than 10%, indicating an inefficient use of shareholder's capital to generate profit, as per Trendlyne data.
Earlier, A R Ramachandran, Independent Research Analyst said that a Daily close above resistance of 165 could lead to a target of 187 in the near term.
About PC Jewellers:
It all started when PC Jeweller first opened its first showroom in 2005 in Karol Bagh, New Delhi with a vision to redefine elegance, allure and style in the form of stunning pieces of jewellery. Today one of the fastest-growing jewellery retail chains having showrooms across 67 cities and 17 states.
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