Rama Steel Pipes Stock Split: Despite the global economy reeling under pandemic pressure, the Indian stock market has spawned quite a few multibagger stocks. Rama Steel Tubes shares one of them. With a market cap of Rs 659 crores, Rama Steel Tubes Ltd. a small-cap company active in the ferrous metals industry. The company is one of India’s top producers of rigid PVC and GI pipes and steel pipes and tubes. The company has announced a stock split, which it revealed this week.
The company said in a BSE filing: “This is a continuation of our previous announcement that was filed with the exchange on June 17, 2022 and June 29, 2022. We would like to inform you that the board of directors of the company has approved the proposal of subdivision of equity of the nominal value of Rs 5/- each fully paid up in shares of the nominal value of Rs 1/- each fully paid up on the Record Date to be determined as approved by the Board of Directors, upon approval by the shareholders through Postal Ballot.”
According to available data on BSE’s filing, the company also announced: “Acquisition of 50 percent of the shares of Hagar Mega Mart Private Limited by issuing new shares of Rama Steel Tubes Limited at the subscription amount of the shares, subject to the approvals from the legal authority and shareholders of the respective companies. The issuance of shares of Rama steel Tubes Limited will be in the form of a preference share issue and will be in accordance with the applicable provisions of the SEBI (ICDR) regulation, 2018 .”
“To consider and approve the issuance of such number of shares of M/s Rama Steel Tubes Limited up to the maximum amount of Rs 32 Crore against acquisition of 51 percent interest in M/s Ashoka Infrasteel and 50 percent shareholding of M /s Hagar Mega Mart Private Limited subject to terms and conditions as may be determined by the Board of Directors of the Company and at a price which may be determined in accordance with the applicable provisions of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2018 and subject to approval by shareholders of the company by postal ballot and approval from applicable regulatory authorities, as appropriate, in accordance with SEBI (ICDR) regulations and other applicable laws,” the company said in BSE filing to switch.
What is a stock split?
A stock split or subdivision of shares is considered by a publicly traded company to make its scrip more affordable for the retail investor category. Consequently, as more investors can enter the script after the split, the investor base in the company increases. So, as there is new investor interest in the company, the entity’s shares are seeing an upward movement in the near term.
Share price history
Shares of Rama Steel closed today at Rs 390.75, down 1.24 percent from the previous close. Shares on the NSE rose from Rs 147.65 on July 7, 2021 to its current level, a multibagger gain of 164.65 percent in one year. The stock is up 9.75 percent in price to date (YTD) or so far in 2022. Based on the current market price, Rama Steel Tubes is trading above 5 days, 20 days, 50 days, 100-day and 200- daily moving averages.
Established in 1974 in Delhi, Rama Steel Tubes has an extensive experience of more than five decades in the steel pipe and tube industry. The company has a presence abroad in countries such as the United Kingdom, United Arab Emirates, Sri Lanka, Ethiopia, Kenya, Uganda, Ghana, Kuwait, Republic of the Congo, Yemen, Guyana, Germany, USA, South Africa, Zambia and Malta, partly thanks to the export percentage of 20 percent. The company can produce up to 2.64,000 tons annually.
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