Bonus shares 2024: Shares of Kothari Products, engaged in real estate and international trade, surged to a four-month high of ₹205 apiece in intraday trade on Friday, December 20 as the stock hit the 20% upper circuit limit. The rally in the stock can be attributed to the company’s plans to consider a bonus issue.

In an exchange filing on Thursday, the company announced that its board will meet on December 27, 2024, to consider recommending bonus shares and an increase in authorised share capital, subject to member approval via a postal ballot process.

“The company is hereby to inform you that a meeting of the Board of Directors of the Company is being convened on 27th December 2024, for considering the recommendation of bonus shares and an increase in authorized share capital of the Company, subject to the approval by its members through the postal ballot process in the said matter,” the company said in its regulatory filing.

If approved, this would mark the company’s third bonus issue, following previous announcements in 2016 and 2014, in ratios of 1:2 and 2:1, respectively.

Shares up nearly 500% since March 2020

Kothari Products has delivered extraordinary returns over the past few years, rising from ₹34.30 in March 2020 to its current market price of ₹205, reflecting a phenomenal gain of 497%. In 2024 alone, the stock has climbed 64%, marking its best yearly performance in a decade, surpassing most annual gains since 2015, when it recorded a 62% return.

Notably, in July 2024, the stock posted an impressive 56% surge, representing its largest monthly gain since February 2014, a period during which it delivered a multibagger return of 105%. However, despite this stellar performance, the stock is still trading below its record high of ₹272, achieved in January 2016.

The company concluded the September quarter (Q2FY25) with revenue from operations of ₹266 crore, remaining unchanged from the previous quarter. However, it reported a net loss of ₹120 crore, as expenses during the reporting period surged sharply to ₹397 crore from ₹268 crore in the corresponding quarter last year.

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