Paushak Limited , a specialty chemicals manufacturer, has announced significant corporate actions aimed at enhancing shareholder value and improving stock liquidity. The company's Board of Directors has proposed a 2:1 stock split and a 3:1 bonus issue, subject to shareholder approval through a postal ballot.

Stock Split and Bonus Issue Details

Paushak Limited plans to sub-divide each existing equity share with a face value of ₹10 into two equity shares with a face value of ₹5. Following this, the company intends to issue three bonus shares for every one share held, effectively quadrupling the number of shares for existing shareholders.

Rationale Behind the Move

The company stated that these corporate actions are designed to:

• Enhance liquidity of the company's shares in the stock market
• Broaden the shareholder base by making shares more accessible to a wider range of investors
• Encourage larger participation and engagement from investors

Current Share Structure and Public Holding

Paushak Limited's current paid-up capital comprises 30,82,114 equity shares with a face value of ₹10 each. The public shareholding stands at 10,12,980 equity shares, held by over 20,000 shareholders.

Proposed Changes to Authorized Share Capital

To accommodate the stock split and bonus issue, Paushak Limited proposes to reclassify its authorized share capital. The new structure will be:

• ₹20 crore divided into 4 crore equity shares of ₹5 each

This change requires an amendment to the company's Memorandum of Association.

Key Dates and Implementation

Dematerialization Requirement

In compliance with SEBI regulations, the new equity shares from the bonus issue will be allotted in dematerialized form only. Shareholders holding physical shares are required to provide their demat account details by August 29, 2025.

Management's Perspective

The Board of Directors believes these proposals are in the best interest of the company and its existing and potential investors. They reflect Paushak Limited's strong financial position and robust reserves.

Shareholders are advised to participate in the e-voting process to register their decision on these significant corporate actions. The outcome of the postal ballot will determine the implementation of these proposed changes, potentially reshaping Paushak Limited's equity structure and market presence.

Paushak Limited , a Gujarat-based company, has announced a series of significant corporate actions aimed at enhancing shareholder value and increasing market participation. The company's Board of Directors has approved a bonus share issue, stock split, and reclassification of authorized share capital, subject to shareholder approval through a postal ballot.

Bonus Share Issue

Paushak has approved a bonus share issue in the ratio of 3:1, meaning shareholders will receive three additional shares for every one share they currently hold. This move will significantly increase the number of outstanding shares, potentially improving liquidity in the stock.

Stock Split

In addition to the bonus issue, the company has decided to split its equity shares. The face value of each share will be reduced from ₹10 to ₹5, effectively doubling the number of shares in circulation. This stock split is expected to make the shares more accessible to a broader range of investors.

Capital Restructuring

Paushak is also reclassifying its authorized share capital. The new structure will consist of 4,00,00,000 equity shares of ₹5 each, totaling ₹20 crore. This change involves converting the existing preference shares into equity shares, simplifying the company's capital structure.

Impact on Shareholders

After the implementation of these corporate actions, for every one equity share of ₹10 face value currently held, shareholders will ultimately possess eight equity shares of ₹5 face value each.

Financial Implications

The bonus issue will require ₹9.25 crore from the company's reserves. Paushak has ₹359.64 crore in free reserves available for capitalization, including a Capital Redemption Reserve of ₹3.14 crore.

Rationale and Expectations

The company stated that these corporate actions are proposed to enable higher participation from public shareholders. By increasing the number of shares in circulation and reducing the face value, Paushak aims to enhance liquidity and potentially broaden its investor base.

These strategic moves by Paushak reflect a proactive approach to capital management and shareholder value creation. Investors and market watchers will be keenly observing how these changes impact the company's stock performance and market perception in the coming months.