IOC to offer bonus share -Governance Now

IOC to offer bonus share

The board of directors has approved the bonus share in the ratio of 1:1, as its first-quarter net profit jumped 25 percent

GN Bureau | August 30, 2016

#IOC #bonus share #net profit

State-owned Indian Oil Corporation (IOC) has announced bonus shares as its first-quarter net profit jumped 25 percent to Rs 8,268.98 crore.

The board of directors has approved the bonus share in the ratio of 1:1. It means the company will issue one equity share of Rs 10 each for every fully-paid up share of Rs 10 each, according to a news report in Telegraph. The government, which holds a majority stake in IOC, will be the key beneficiary of the move.

The government owns a 58.28 percent stake in Indian Oil, which controls nearly half of the country's fuel market, 35 percent of the national refining capacity and 71 percent of downstream pipelines.

The capital restructuring rules for central public sector enterprises (CPSEs) notified by the government in May mandates every PSU to issue bonus shares if its reserves and surplus are equal to or more than 10 times its paid-up equity share capital.

IOC is the country's largest commercial entity with a sales turnover of Rs 3,99,601 crore ($61 billion) and profit of Rs 10,399 crore ($1.58 billion) in 2015-16. It ranks 161 among the world's largest companies - and the first among Indian companies - in the Fortune Global 500 list for 2016.

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