28.3% returns from 52-week low; Board announces stock split in the ratio of 5:1

The Board of Directors of Computer Age Management Services Limited (CAMS) has approved a significant corporate action: the sub-division (split) of the company's equity shares. This proposal involves splitting one existing equity share with a face value of Rs 10 into five new equity shares, each with a face value of Rs 2. The primary rationale behind this 1:5 split is to enhance the liquidity of the shares, improve affordability and accessibility for retail investors, and ultimately foster a broader shareholder base and greater market participation. This action is, however, subject to the approval of the company's shareholders via a postal ballot, after which the record date will be determined and announced.

The share split will not alter the company's total authorised, subscribed, or paid-up capital value, but it will increase the number of shares fivefold. For instance, the Authorised Share Capital will shift from 5,12,50,000 shares of Rs 10 each to 25,62,50,000 shares of Rs 2 each, maintaining a total value of Rs 51,25,00,000. Similarly, the number of Paid-up shares will increase from 4,95,30,127 to 24,76,50,635. Consequent to this sub-division, the Board also approved the necessary alteration to the Capital Clause of the company's Memorandum of Association. The entire process is tentatively expected to be completed within two months from the date of receiving shareholder and all requisite regulatory approvals.

The company has a market cap of over Rs 19,000 crore and has been maintaining a healthy dividend payout of 72.1 per cent. The shares have a PE of 43x, an ROE of 44 per cent and an ROCE of 55 per cent. The stock is up by 28.3 per cent from its 52-week low of Rs 3,030 per share.

Disclaimer: The article is for informational purposes only and not investment advice.