Shares of Tata Steel rose amid a market crash today as the Tata Group firm said the board would on May 3 consider a proposal to split the stock and also recommend a dividend. The large cap stock opened at Rs 1,335 against the previous closes of Rs 1319.25 on BSE. Tata Steel shares further rose 2.31% to Rs 1,349.80 in early trade. The stock has gained after three sessions of fall.
The share trades higher than 20 day, 50 day, 100 day and 200 day moving averages but lower than 5 day moving averages.
The stock has gained 49.48% in one year and risen 20% in 2022.
Total 1.03 lakh shares of the firm changed hands amounting to a turnover of Rs 13.85 crore on BSE. Market cap of the firm surged to Rs 1.64 lakh crore on BSE.
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The stock hit a 52-week high of Rs 1,534.60 on August 16,2021 and a 52-week low of Rs 854.90 on January 19, 2021.
However, Tata Steel did not specify the ratio of the stock split. The company said the meeting on May 3 would consider a sub-division of the shares with a nominal value of┬а Rs 10 each.
A stock split leads to increase in liquidity of the stock. The stock also gets more affordable for retail investors since the company divides the existing shares into new shares. However, market cap of the firm remains the same.
It will eventually be subject to regulatory/statutory approvals as may be required and the approval of the shareholders of the company, the steel maker added.
On May 3, the company will also announce earnings for the quarter ended March 31.
In third quarter of the last fiscal, the India’s largest steel manufacturer reported a 139 per cent year-on-year rise in its consolidated net profit at Rs 9,572 crore against a net profit of Rs 4,011 crore in the year-ago period.
Sequentially, the steel maker had reported a profit of Rs 12,548 crore in the September quarter. Consolidated revenues for the quarter rose about 45 per cent YoY to Rs 60,783 crore compared with Rs 41,935 crore in the year-ago quarter.
On a QoQ basis, the revenues were broadly stable as improvement in net realisations more than offset the drop in volumes, the company said .
The company’s consolidated earnings before interest, taxes, depreciation, and amortisation or EBITDA stood at Rs 15,853 crore.
Meanwhile, Sensex plunged 1150.25 points to 57,188 and Nifty slipped 309 points to 17,166 in early trade today.
