Indraprastha Gas Ltd on Tuesday announced a 1:1 bonus share - one free share for every share held by shareholders as India's biggest city gas retailer looks to increase retail investor participation and reward shareholders.
This is IGL's maiden bonus issue.
The Board of Directors of IGL in a meeting on Tuesday approved "issuance of bonus shares to the shareholders of the company in the ratio of 1:1, i.E. 1 (one bonus equity Shares of face value of Rs 2 each fully paid up for every 1 (one) existing equity shares of face value of Rs 2 each fully paid up, to the eligible shareholders of the company as on the record date," the firm said in a stock exchange filing.
The share capital of the company will increase from Rs 140 crore to Rs 280 crore post-bonus issue. Rs 140 crore would be capitalized from free reserves to implement the bonus issue.
"The company has a total balance of Rs 8,411.74 crore as free reserves for capitalization," IGL said.
The bonus share is likely to be credited within two months.
IGL retailers CNG to automobiles and pipes natural gas to household kitchens and industries Delhi and its adjoining cities of Noida, Greater Noida, Ghaziabad and Gurugram. It also retails in few other cities in Haryana, Rajasthan and Uttar Pradesh.
It meets fuel requirements of over 1.7 million vehicles running on CNG through a network of 882 CNG stations. IGL has connected over two and a half million households in these cities with PNG.
"This strategic decision further underscores the company's unwavering commitment to enhancing shareholder value while reinforcing investor confidence in IGL's robust financial performance and future growth trajectory," IGL later said in a statement.
The record date for determining eligible shareholders will be decided later.
"This announcement aligns with IGL's enduring philosophy of rewarding its shareholders, underpinned by strong financial fundamentals and consistent growth," the firm said.
The bonus issuance not only reflects the company's healthy reserves but also its optimism in sustaining its leadership position in India's clean energy ecosystem, IGL said.
Commenting on the issue, Kamal Kishore Chatiwal, Managing Director, IGL, said, "The bonus share issue is a testament to our continued focus on creating long-term shareholder value. I reinforce our confidence in the company's potential to scale new heights while rewarding our investors for their unwavering trust and support."
Mohit Bhatia, Director (Commercial) said, "The announcement of this bonus issue marks another significant milestone in our journey of sustainable growth and value creation. It is a reflection of our sound financial position and our vision to consistently deliver tangible returns to our stakeholders. This initiative reaffirms our dedication to fostering trust and driving long-term shareholder engagement.
The bonus share issuance demonstrates IGL's resilience and capacity to create enduring value for its shareholders while maintaining its leadership position in the industry, the statement added.
