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NMDC Announces 2:1 Bonus Share Issue Amid 18% Q2 Profit Growth

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Synopsis:

State-owned NMDC Ltd reported an 18% YoY profit increase for Q2, reaching ₹1,211.6 crore. Revenue surged 22.5% to ₹4,919 crore, alongside a 2:1 bonus share approval. NMDC share price closed at ₹232.95 on BSE.

NMDC news today

State-owned NMDC Ltd has announced a 2:1 bonus share issue following an 18.1% year-on-year (YoY) rise in net profit to ₹1,211.6 crore for the second quarter ending 30 September 2024. NMDC’s board approved two bonus shares for every share held, reflecting the company’s solid quarterly performance and increased shareholder value.

Also read: KPI Green Energy Board to Consider Second Bonus Share Issue in 2024

NMDC LTD.

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217.63-3.58 (-1.61 %)

Updated - 21 November 2024
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Key Takeaways:

  • Net Profit: Increased 18.1% YoY to ₹1,211.6 crore.

  • Revenue: Up 22.5% YoY, totalling ₹4,919 crore for Q2.

  • EBITDA: Increased 16.4% to ₹1,385.7 crore, with a 28.2% EBITDA margin.

  • Bonus Share Ratio: Two bonus shares for each existing share.

  • NMDC Share Price: Closed at ₹232.95, down by ₹2.70.

Also read: SIP Inflows Cross ₹25,000 Crore Mark for First Time in October

Revenue and Profit Performance

NMDC’s revenue from operations surged by 22.5% YoY to ₹4,919 crore in Q2 FY2024, significantly above last year’s figure of ₹4,014 crore. However, the revenue and profit fell short of market estimates, with analysts predicting revenue of ₹4,681 crore and profit of ₹1,433 crore. The EBITDA rose by 16.4%, reaching ₹1,385.7 crore compared to ₹1,191 crore last year, although it was below the expected ₹1,672 crore. Despite the robust growth, the EBITDA margin saw a slight dip, standing at 28.2%, compared to 29.7% in Q2 FY2023.

Also read: Alembic Pharma Gains USFDA Approval for Generic Hypertension Drug

Bonus Share Issue and Capital Increase

To further reward shareholders, NMDC’s board approved a 2:1 bonus share issuance. This means eligible shareholders will receive two bonus shares for every existing share held. Additionally, the company has proposed an increase in authorised share capital from ₹400 crore to ₹1,000 crore, with regulatory approvals pending. This increase will allow NMDC to issue up to 1,000 crore equity shares, facilitating future growth initiatives and shareholder rewards.

Financial Metric

Q2 FY2024

Q2 FY2023

CNBC-TV18 Poll

YoY Growth

Net Profit

₹1,211.6 crore

₹1,026 crore

₹1,433 crore

18.1%

Revenue

₹4,919 crore

₹4,014 crore

₹4,681 crore

22.5%

EBITDA

₹1,385.7 crore

₹1,191 crore

₹1,672 crore

16.4%

EBITDA Margin

28.2%

29.7%

35.7%

-1.5%

NMDC Share Price Reaction

The NMDC share price saw a minor dip following the announcement, closing at ₹232.95 on the BSE, down by ₹2.70 or 1.15%. The decline could reflect investor response to the lower-than-expected results, despite NMDC’s efforts to enhance shareholder value through bonus shares. The NMDC share price may respond to these developments as investors consider the long-term value of the bonus issue.

NMDC’s Q2 performance showcases steady growth in revenue and profit, although it missed market expectations. The issuance of bonus shares at a 2:1 ratio and the planned increase in authorised share capital reinforce NMDC’s commitment to shareholder value, positioning the company for continued financial resilience in future quarters.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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