Premier Explosives board approves 1:5 stock split, ₹400 crore fund raise proposal; shares up 3.7%
Upstox
3 min read • Updated: April 19, 2024, 3:24 PM
Summary
Shortly after the bourses were informed about the board’s decisions, the shares climbed to ₹2,094.60 apiece on the National Stock Exchange (NSE), up 3.7% as against the previous day’s close. Year-to-date, the stock has rallied 33.6%.
The board of directors of Premier Explosives, a key player in the manufacturing of solid propellants for the defence sector, has given its nod for the split of shares in the ratio of 1:5, a regulatory filing stated on Friday, April 19.
The company’s board has also approved the proposal to raise ₹400 crore, the exchange filing added. Following the announcement, the shares of Premier Explosives surged at the stock market.
At 3 pm, shortly after the bourses were informed about the board’s decisions, the shares climbed to ₹2,094.60 apiece on the National Stock Exchange (NSE), up 3.7% as against the previous day’s close.
The fresh spike in the value of Premier Explosives shares comes 10 days after the stock scaled a 52-week high. The surge was attributed to the company’s announcement on April 9 that the board will meet on April 19 to consider the stock split proposal.
Premier Explosives’ 1:5 stock split
The company informed the exchanges that its board has approved the “sub-division or split of existing one equity share of face value of ₹10 each, fully paid up into five equity shares of face value of ₹2/- each”.
The record date for the purpose of sub-division/split of existing equity shares will be announced in due course, Premier Explosives noted, further adding that the stock split is subject to the approval of the members of the company.
₹400 crore fund raise
According to Premier Explosives, its board has given the nod to raise up to ₹400 crore through public issue, preferential issue, private placement (including one or more qualified institutional placements), or through any other permissible mode and/or combination thereof.
The amount is to be raised “in one or more of the tranches for an aggregate amount not exceeding ₹400 crore”, the regulatory filing added.
The fund raise would be subject to regulatory approvals, and would also require the nod from shareholders, the company said.
While Premier Explosives is yet to declare the results of Q4 FY24, the company had posted a net profit of ₹1.71 crore in the quarter ended December 2023. This was up 172% as compared to the year-ago period. The total income grew 24.5% to ₹47.4 crore during the period.
Year-to-date, Premier Explosives stock has climbed by around 33.6%, after factoring in the gains made during the trading session on April 19. In the last one-year period, the shares have risen by 406.5%.