Bajaj Finserv Announces a Stock Split and Bonus Share Issue; Important Information for Investors

According to Bajaj Finserv, the proposal for a stock split or sub-division of equity shares in a ratio of 1:5 as well as the issuing of bonus shares in a ratio of 1:1 received board approval. The partition of each existing equity share, which has a face value of Rs. 5, into five fully paid-up equity shares, has been approved by the board. The issue of one bonus equity share with a face value of Rs. 1 was also approved, the financial services company said in a filing with the stock exchange today.

According to the company's regulatory filing, it will be necessary to alter the capital providersauthorizedof the company's memorandum of association, subject to the consent of the shareholders, which must be secured by postal ballot.

Bajaj Finserv's consolidated net profit for the first quarter of FY23 increased by roughly 57% to Rs 1,309 crore from Rs 833 crore in the corresponding quarter of FY22. The profit included an unrealized MTM loss of Rs 283 crore from insurance subsidiaries, compared to a gain of Rs 25 crore year over year (YoY).

The Bajaj group's multiple financial services companies are housed under Bajaj Finserv.

Bajaj Finserv Stock Split

By issuing extra shares to the existing shareholders, a stock split raises the number of shares that are outstanding. Although a stock split lowers the share price on an individual basis, it has no impact on the company's market capitalization.

If a company's stock price levels are extremely high, it may decide to split its shares, which would boost the stock's liquidity and make it more accessible to investors. Bonus shares, on the other hand, are extra, fully paid shares that the firm issues to its current shareholders.

Subject to obtaining the required permissions, the business plans to carry out the required corporate action on or before September 26, 2022.

"Over the years, the company and its subsidiaries have experienced substantial growth in both business and performance. The company has one of the highest share prices among its competitors, despite having one of the smallest capital bases.

Stock Price History

Bajaj Finserv's share price increased by up to 10% after the board authorized a 1:1 bonus issue and a 1:5 stock split.

The share price of Bajaj Finserv has decreased by more than 15% so far in 2022 (year to date), compared to an increase of roughly 4% over the previous year. The primary business lines for Bajaj Finserv include loan, asset management, wealth management, and insurance.

To expand the group's interest in financial services, the firm was established in 2007 as a result of its demerger from Bajaj Auto Limited. The Bajaj Group's operations that provide financial services are housed under Bajaj Finserv. authorized

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