Sandur Manganese & Iron Ores Limited (SMIORE) has announced plans for a significant capital restructuring, including a bonus share issue and an increase in authorized share capital. The company's board has proposed these measures to reward existing shareholders and enhance stock liquidity.

Bonus Share Issue

SMIORE plans to issue bonus shares in a 2:1 ratio, offering two new fully paid-up equity shares for every one existing share held by eligible shareholders. This move aims to capitalize on the company's strong financial position and robust consolidated performance in recent quarters.

Authorized Capital Increase

To facilitate the bonus issue and future growth plans, SMIORE proposes to increase its authorized share capital from ₹200.00 crore to ₹600.00 crore. This would involve raising the number of authorized equity shares from 20 crore to 60 crore, each with a face value of ₹10.

Financial Implications

The bonus issue will capitalize up to ₹324.07 crore from the company's available reserves, which stood at ₹2,581.41 crore as of June 30. This capitalization represents a significant return of value to shareholders without requiring any payment from them.

Shareholder Approval Process

SMIORE is seeking shareholder approval for these proposals through a postal ballot. The remote e-voting period is scheduled from August 12 to September 10. The company has engaged the National Securities Depository Limited (NSDL) to facilitate the e-voting process.

Strategic Rationale

The board cited several reasons for these initiatives:

1. Rewarding existing shareholders
2. Encouraging retail investor participation by making shares more affordable
3. Increasing share liquidity in the market

Future Plans

In addition to the bonus issue, SMIORE's board had previously approved a proposal to raise funds through a Qualified Institutions Placement (QIP) for an aggregate amount not exceeding ₹1,000.00 crore, subject to shareholder approval.

Market Impact

These corporate actions, if approved, are expected to have a positive impact on SMIORE's stock trading volume and potentially support the share price in the long term.

Shareholders are advised to review the detailed postal ballot notice and cast their votes before the e-voting deadline. The results of the postal ballot are expected to be announced on or before September 12.

Sandur Manganese & Iron Ores Limited (SMIORE) has announced a series of significant developments, including a bonus share issue, re-appointment of its Managing Director, and robust financial results for the first quarter.

Bonus Share Issue

The company's Board of Directors has approved a bonus issue in the ratio of 2:1, meaning shareholders will receive two new fully paid-up equity shares for every one existing share held. This move will see the issuance of approximately 32.41 crore new equity shares, increasing the total paid-up share capital from ₹162.03 crore to ₹486.10 crore.

Re-appointment of Managing Director

Bahirji Ajai Ghorpade has been re-appointed as the Managing Director for another three-year term, effective from October 1, 2025, to September 30, 2028. The decision, subject to shareholder approval, comes as recognition of Ghorpade's leadership, during which the company has achieved record-breaking turnover and profitability.

Q1 Financial Performance

For the quarter ended June 30, SMIORE reported strong financial results:

The company's consolidated revenue saw a significant year-on-year increase of 88.72%, while net profit rose by 15.64%.

Segment Performance

• Mining segment revenue stood at ₹370.42 crore
• Steel segment, which includes operations of subsidiary Arjas Steel Private Limited, contributed ₹724.94 crore to the total revenue

Expansion of Mining Capacity

SMIORE received approval from the Central Empowered Committee to enhance its Permissible Annual Production (PAP) limit. The new limits are:

• Manganese ore: Increased from 0.032 Million Metric Tonnes (MMT) to 0.049 MMT
• Iron ore: Set at 0.089 MMT for Mining Lease No. 2679

Additionally, the company is permitted to transport 0.327 MMT of already produced incidental iron ore over the next two financial years.

Looking Ahead

With these developments, Sandur Manganese & Iron Ores Limited appears well-positioned for growth. The bonus issue is likely to improve stock liquidity, while the increased production limits could potentially boost revenues in the coming quarters.

The upcoming Annual General Meeting, scheduled for September 17, 2025, will be a key event where shareholders will vote on these significant decisions, including the re-appointment of Bahirji Ajai Ghorpade as Managing Director and the proposed bonus issue.