Sona BLW Precision Forgings Limited has taken a significant step to align its executive compensation with market standards and company performance. The Board of Directors has approved the Performance Share Plan 2025 (PSP 2025) for Managing Director and Group CEO Vivek Vikram Singh, subject to shareholder approval.

Key Details of the Performance Share Plan 2025

The PSP 2025 aims to address the current below-market compensation of Mr. Singh, which was revealed in a recent benchmarking study. Here are the main points of the plan:

• Total Shares: Up to 1.5 million equity shares over 5 years
• Eligibility: Exclusively for Vivek Vikram Singh, Managing Director and Group CEO
• Performance Metric: Based on year-on-year growth in consolidated EBITDA
• Implementation Period: Financial Years 2025-26 to 2029-30
• Lock-in Period: 1 year from the date of allotment for each tranche

Compensation Benchmarking Results

An independent professional firm conducted a compensation benchmarking study, which revealed:

This disparity prompted the Board to take action to bring Mr. Singh's compensation in line with industry standards.

Performance-Based Share Allocation

The number of shares to be offered each year will be determined by the company's EBITDA growth:

Company Performance Under Singh's Leadership

Since Mr. Singh's appointment as MD and Group CEO in 2019, Sona BLW Precision Forgings has shown growth:

• Revenue growth: 31%
• Profit After Tax growth: 35%

Regulatory Compliance

The PSP 2025 adheres to the following regulatory requirements:

• Compliant with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021
• Total remuneration, including PSP 2025, will be within the 5% limit of net profits as per Companies Act, 2013

This move by Sona BLW Precision Forgings demonstrates the company's commitment to retaining top talent and aligning executive compensation with company performance and shareholder interests. The plan's success will depend on the company's ability to achieve substantial EBITDA growth over the next five years.

Sona BLW Precision Forgings Ltd (SONACOMS) is exhibiting technical indicators that suggest a possible reversal of its multi-month downtrend, which has persisted for over a year. The stock has experienced a significant decline from Rs. 760 in September to lows near Rs. 370 in April. However, recent months have seen the stock forming a base, indicating a potential shift in its trajectory.

Technical Indicators

Several technical indicators are pointing towards a possible trend reversal:

1. Moving Averages: The stock is currently trading above all key moving averages, a positive sign for its short-term performance.

2. Support Levels: SONACOMS has taken support at its 200-day moving average, which is often considered a significant long-term trend indicator.

3. MACD: The daily Moving Average Convergence Divergence (MACD) remains bullish, suggesting positive momentum.

4. RSI: The Relative Strength Index (RSI) has formed a fresh 14-period high, indicating increasing buying pressure.

5. Relative Strength: The relative strength line against the Nifty 500 has reversed higher, suggesting outperformance compared to the broader market.

6. On-Balance Volume: This indicator has reached new highs, signaling strong volume participation, which often precedes price movements.

Potential Scenarios

Based on the current technical setup, two potential scenarios emerge:

1. Bullish Case: A move higher could take the stock to Rs. 520, representing a significant upside from current levels.

2. Bearish Case: A close below Rs. 475 would negate the current technical setup, potentially leading to further downside.

Investors and traders are advised to closely monitor these levels and conduct their own research before making any investment decisions. It's important to note that technical analysis is just one aspect of stock evaluation, and fundamental factors should also be considered for a comprehensive analysis.