NBCC Shares Soar 4% as Stock Goes Ex-Bonus, 90 Crore Shares to be Issued

Shares of NBCC (India) Ltd rose by over 4% on October 7, 2024, with the stock trading ex-bonus. The public sector unit (PSU) had previously announced a bonus issue at a 1:2 ratio. This entitles shareholders to receive one new fully paid-up equity share of Re 1 for every two existing shares they hold. October 7 also marks the record date for determining which shareholders are eligible for the bonus shares.

In a regulatory filing, NBCC informed that a total of 90 crore bonus equity shares would be issued from free reserves, which were generated from profits. This aligns with the audited financial statement as of March 31, 2024. The company revealed that it had Rs 1,959 crore in reserves and surplus available for this purpose, and the shares are expected to be credited within two months from the board’s approval on or before October 31, 2024.

As of 9:30 AM, NBCC shares were trading 4.1% higher at Rs 117.32 on the National Stock Exchange (NSE). The stock has seen an increase of 43% so far this year, outperforming the Nifty index which rose by 15% in the same period. Over the past twelve months, the counter has rallied by 103%, effectively doubling investors’ capital, while Nifty’s gains amounted to around 28%.

Nuvama, a financial services firm, remains optimistic about the PSU stock. The firm cites improvement in order intake, execution, margins, and real estate monetization as positive factors supporting NBCC’s growth. According to a report by Nuvama last month, NBCC possesses a strong order book of Rs 81,300 crore, with a book-to-bill ratio of 7.6x. Notably, robust order inflows amounting to Rs 19,800 crore have been secured this fiscal year, compared to Rs 23,500 crore in FY24. “A buoyant realty cycle is resulting in improved opportunities for the company with many PSUs/government looking to monetize surplus land holdings,” the report mentioned.

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