Yesterday, mid-morning, Varun Beverages announced that its Board had approved a bonus to celebrate its silver jubilee. The bonus is in the ratio of 1:2 , one share for every two held. The market was not happy and the stock price tanked over 4.5% to close at Rs.892.
Today morning, there seems to be a change of heart and all of a sudden, traders are liking the bonus ratio. Currently the stock is the top gainer on the BSE, it opened today almost 3% higher at Rs.885.25 and rose to hit an intraday high at Rs.920, going up 6%.
Clearly, with traders and investors on the lookout for value buys in midcaps, today the stock is back in favor.
The company has said that securities premium of Rs.91.32 crore is required for implementing the bonus issue and as at 31st dec2018, balance of Rs 1,840 crore is available in securities premium account.