RIL to issue 1:1 bonus shares

Diwali gift after 12 years, net profit at Rs15,296 cr, stocks to flare up

 
The Mukesh Ambani Group’s flagship company also declared a dividend of Rs 13 per share resulting in a payment of Rs 2,219 crore inclusive of taxes of Rs 322 crore. The twin pre-diwali gift was to reward shareholders on a sustained basis, said the company in a statement.

RIL’s Chief Financial Officer Alok Agarwal made it clear that the bonus is also applicable to shareholders of Reliance Petroleum (RPL) which was recently merged with RIL. “With its strong balance sheet, large cash reserves and substantial financial flexibility owing to its Treasury Stock holding which have a current value of nearly Rs 40,000 crore RIL is now ready to invest for the future, ” Agarwal said in a statement. The bonus issue comes after 12 years after RIL had issued a bonus at 1:1 ratio was in October 1997.

Since its listing in 1978, total returns to RIL shareholders are 25 per cent compounded.  Since the demerger, it has created value of Rs 2,47,000 crore in market capitalisation, while shareholders have earned 40 per cent compounded returns, the statement said.

Dalal Street is expected to give up a thumbs up signal to RIL’s bonus announcement when the morning opens up on Thursday morning. Analysts were surprised at the turn of events at RIL front too. In this context, Amitabh Chakraborty, President – equity at Religare Securities said “the management may be trying to neutralise the negative perception that came from the recent sale of its treasury stocks which gave a perception that the current share prices have reached a cap.”

Idea mooted

Industry observers also pointed out that Anil Ambani — younger sibling of RIL Chairman – had at various public forums mooted the idea that  Treasury Stocks of RIL be disbursed to its shareholders as a bonus.

Meanwhile, RIL this day reported a consolidated net profit of Rs 15,296 crore for the year ended March 31, 2009 as against a net profit of Rs 15,324 crore (from ordinary activities) in the FY08, it said.  The announcement of audited financial results for 2008-09 came late as the merger of Reliance Petroleum with RIL was awaiting regulatory and court approvals. The figures include those of Reliance Petroleum (RPL), which amalgamated with the company with effect from April 1, 2008 and are therefore, not comparable with those of previous year, the company said in the filing.

The net turnover of RIL at Rs 1,51,224 crore for the year ended March 31, 2009, whereas it was Rs 1,37,147 crore a year-ago. On standalone basis, RIL’s audited net profit stood at Rs 15,309 crore for 2008-09, whereas it was Rs 19,458 crore in the previous year, while its net turnover was Rs 1,41,847 crore in the last fiscal as compared to Rs 1,33,443 crore in 2007-08.

During the year, the company announced a voluntary separation scheme for the employees of Patalganga unit and about 430 employees had accepted the VSS.  It also said  that it has recognised Rs 370 crore towards liabilities on account of corporate guarantees issues on behalf of a subsidiary, being an exceptional item.  In the previous year, exceptional item of Rs 4,733 crore represent gains primarily arising out of transactions concerning Reliance Petroleum shares

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