Shares of Mazagon Dock Shipbuilders Ltd. have jumped nearly 5% today as the market awaits the company's board meeting on October 22. At this meeting, the company will discuss a potential stock split and a dividend declaration. This state-run defence company, known for its strong presence in the shipbuilding sector, has attracted significant interest from retail investors looking to invest in stocks with strong growth potential.
First-ever stock split and dividend boost
Mazagon Dock currently has a face value of ₹10 per share and declared a final dividend of ₹12.11 per share for the financial year 2024. This will be the first stock split in the company's history, a move aimed at making the stock affordable for retail investors and increasing liquidity in the market.
For those looking to invest in stocks, this development presents a timely opportunity, especially as retail participation has surged. Retail shareholders increased their stake from 9% in June to 10.6% by the end of September, with the total number of such investors rising to 6.56 lakh.
Market performance and prospects
Despite correcting almost 30% from its July peak of ₹5,860, Mazagon Dock shares remain up by 90% in 2024, with a current trading price of ₹4,431.1. The company's market capitalisation, which once surpassed ₹1 lakh crore, now stands at ₹85,000 crores. However, the stock continues to attract investors eager to invest in stocks of state-run companies with solid growth prospects.
If approved, the stock split will likely boost investor sentiment further by reducing the cost per share, making it more accessible to a broader base of investors. Moreover, the dividend payout adds an attractive incentive for long-term holders.
Key takeaways
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