Indian Oil shares increase as the stock trades ex-bonus

The board of directors of Indian Oil suggested issuing bonus shares at a 1:2 ratio.

Indian Oil Corporation (IOC) is an oil marketing firm. On Thursday, the stock began trading ex-bonus, one day before the record date for the 1:2 bonus shares issue. Shares of IOC rose more than 2 percent to $74.8 per share on the BSE.

The company’s board of directors has advised issuing bonus shares in a 1:2 ratio, meaning that one new bonus equity share will be issued for every two existing shares that investors already own. The board decided that the record date for determining a shareholder’s eligibility to earn bonus shares is Friday, July 1, 2022.

“The board has recommended issue of bonus shares in the ratio of 1:2 i.e. One new bonus equity share of 10/- each for every Two existing equity shares of 10/- each fully paid up subject to the approval of shareholders through postal ballot. The Board has fixed 1’1 July 2022 as record date to determine the eligibility of shareholders to receive bonus shares,” the company had informed in an exchange filing. Bonus shares are additional, fully paid shares that a firm issues to its existing owners.

Indian Oil reported a 31 percent decline in net profit for the fourth quarter that ended in March 2022 as record refining margins were eliminated by a compression on petrochemical margins and losses on sales of motor fuel. January through March had a standalone net profit of 6,021 crore, down from 8,781 crore during the same time last year. Sequentially, the earnings increased from the prior quarter’s $5,861 crore.

In the quarter under review, the state-run oil marketing business reported revenue of 2,06,461 crore, up from 1,63,733 crore in the equivalent quarter of the previous financial year. The core gross refining margin (GRM), also known as the current price GRM for the years 2021–2022, was $7.61 per barrel, according to the business.

The board had also proposed a final dividend of 2.40 per equity share with a face value of 10 for the fiscal year 2021–2022, which translates to a final dividend of 3.60 per equity share with a face value of 10 per share (pre-bonus).