Gujarat government sets off firecrackers in stock market with revolutionary policy - 7 PSU stocks hit upper circuit, are you invested?
Today’s trending news was a big announcement made by Government of Gujarat and due to which these 7 PSU company stocks were trending today and few of them hit upper circuit.
On Wednesday, the benchmark indices were trading higher. BSE Sensex Index was up by 0.23 per cent at a level of 60,269 and NSE Nifty-50 Index was up by 0.18 per cent at a level of 17,801.
Today’s trending news was a big announcement made by Government of Gujarat and due to which these 7 PSU company stocks were trending today and few of them hit upper circuit.
Government of Gujarat has announced a policy for minimum levels of dividend distribution and bonus shares for its State PSUs including listed companies.
By government resolution dated April 24, 2023, Government of Gujarat has mandated that minimum 30 per cent of profit after tax or 5 per cent of net worth, whichever is higher should be the minimum level of dividend declared for shareholders. However, it has been mentioned in the order that this is only the minimum level and maximum permissible level of dividend which should be declared.
Buyback of Shares:
Similarly, as per the new policy, every state PSU having a net worth of at least Rs 2000 crore and cash and bank balance of Rs.1000 crore have been mandated to exercise the option to buy back their own shares.
Bonus Shares:
As per the new policy, state PSUs which have defined reserve and surplus equal to or more than 10 times of its paid-up equity share capital are required to issue bonus shares to its shareholders.
Splitting of Shares:
Lastly, the State Government has mandated splitting of shares where market price or book value of state PSUs’ shares exceeds 50 times of its value, provided its existing face value of share is more than Rs 1.
It is expected that this new policy of compulsory dividend and bonus shares will add to the valuation of Gujarat States’ PSUs. Incidentally, all 7 listed PSUs of Gujarat are making profits.
Following are the 7 PSU’s Gujarat based companies:
Do you own any of these stocks in your portfolio? Do let us know in the comment session below!