Indian Oil Corporation Rises Ahead of Bonus Shares Issue; What Investors Should Know

IOC Share Price: Oil marketing company Indian Oil Corporation (IOC) shares surged more than 3 per cent to Rs 75.55 apiece on the BSE as the stock started trading ex-bonus in Thursday’s session. Last month, the company said that its board has considered and approved bonus issues of shares.

The board of directors of the company in its filing said, “the Board has recommended issue of Bonus Shares in the ratio of 1:2 i.e. One new bonus equity share of Rs. 10/- each for every Two existing equity shares of Rs. 10/- each fully paid up subject to the approval of shareholders through postal ballot. The Board has fixed July 1, 2022, as the record date to determine the eligibility of shareholders to receive bonus shares.”

Indian Oil Corporation Ltd., incorporated in the year 1959, is a Large Cap company (having a market cap of Rs 1,00,119.58 Crore) operating in the Gas & Petroleum sector. Indian Oil Corporation Ltd. key Products/Revenue Segments include Petroleum Refinery Products, Other Operating Revenue, Other Services, Sale of services, Scrap and Subsidy for the year ending 31-Mar-2021.

IOC Financials

Indian Oil reported a 31 per cent drop in the fourth quarter ended March 2022 net profit as record refining margins were wiped away by a margin squeeze in petrochemicals and losses on auto fuel sales. Standalone net profit of Rs 6,021 crore in January-March, compared with Rs 8,781 crore in the same period a year back. Sequentially, the profit was higher than Rs 5,861 crore in the previous quarter.

The state-run oil marketing company reported revenue of Rs 2,06,461 crore during the quarter under review, as compared to Rs 1,63,733 crore logged in the corresponding quarter of the previous financial year. The core gross refining margin (GRM) or the current price GRM for the year 2021-22 after offsetting inventory gains came to $7.61 per barrel, the company had said.

The board had also recommended a final dividend of Rs 3.60 per equity share having face value of Rs 10 each (pre-bonus), which translates into final dividend of Rs 2.40 per equity share having face value of Rs 10 each (post-bonus) for financial year 2021-22.

Share Price History

The stock quoted a 52-week low price of Rs 67.73 and a high of Rs 94.5. At the prevailing price, the stock traded at 4.25 times its trailing 12-month EPS of Rs 17.78 per share and 0.82 times its book value, as per BSE data. The scrip has been an outperformer, up 4.97 per cent in the past one year in comparison with a 0.77 per cent gain in Sensex.

What Do Brokerages Say?

ICICI Securities has a buy call on Indian Oil Corporation with a target price of Rs 145. The current market price of Indian Oil Corporation is Rs 106.65. The time period given by the analyst is one year when Indian Oil Corporation Ltd. price can reach the defined target.

The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.

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