TVS Motor shares rise over 2% on board nod to preferential bonus share issue in 4:1 ratio
Upstox
2 min read • Updated: March 21, 2024, 12:25 PM
Summary
TVS Motor will issue four preference shares bearing interest of 6% per annum for every equity share held in the company. Every shareholder will get preference shares of ₹40 for each share held by them and at the end of tenure will get a total of ₹42.5 with interest.
TVS Motor Company Ltd shares gained more than 2% on Thursday after the company announced that its board has approved a bonus non-convertible redeemable preference share issue of up to ₹1,900 crore to equity shareholders.
The board in its meeting on Wednesday approved the issue of four non-convertible redeemable preference shares of ₹10 each for every one equity share held by shareholders as a bonus, according to an exchange filing.
The total issue size of the preference shares will be ₹1,900 crore and the company will utilise its reserves to bear the cost of the issue.
The coupon rate will be 6% per annum and the non-convertible redeemable preference shares will be redeemed on the expiry of 12 months from the date of allotment, the company informed the exchanges.
As per the issue, every shareholder will get preference shares of ₹40 for each share held by them and at the end of tenure will get a total of ₹42.5 with interest.
The preference shares will be listed on NSE and BSE.
The announcement of the bonus preference share issue has come following the company approving an interim dividend of ₹8 per share for the FY 2023-24. The record date was March 19, 2024. The total cost of dividend payout is ₹380 crore.
TVS Motor shares rose by 2.2% to hit a high of ₹2,080.95 apiece on the NSE in the morning trade. The stock was trading 0.30% lower at ₹2,045.7 apiece at 12:25 pm.
Meanwhile, the company board also approved the appointment of two new independent directors. Chennai-based Sanmar Group Chairman Vijay Sankar and Shailesh Haribhakti and Associates Chairman Shailesh Haribhakti will join the company board subject to shareholders’ approval.
TVS Motor also announced that its subsidiary TVS Motor (Singapore) Pte Ltd has completed the acquisition of an additional 9.72% stake in Killwatt GmbH. The shareholding of the company in Killwatt GmbH has increased from 39.28% to 49%.
TVS Motor Company is a leading two and three-wheeler manufacturer in India. It has four manufacturing facilities in India and Indonesia.