Mazagon Dock Shares Dive 8.5% Ahead of Historic Stock Split

Shares of Mazagon Dock Shipbuilders Ltd. fell by as much as 9% on Tuesday, trading 8.52% lower at Rs 4,268.85 on the Bombay Stock Exchange (BSE) as of 12:39 pm. This decline comes ahead of a board meeting set to discuss a potential stock split, a first in the company’s trading history. At 12:55 pm, shares were down 8.75% at Rs 4,257.55.

While Mazagon Dock has issued dividends previously, it has never executed a stock split or issued bonus shares. The company’s shares currently have a face value of Rs 10 each. In addition to considering the stock split, the board will also discuss a dividend for shareholders, following the final dividend of Rs 12.11 per share declared for FY24.

Retail interest in Mazagon Dock has surged, with the number of retail shareholders increasing from 4.64 lakh in June to 6.56 lakh by the end of September, raising retail ownership from 9% to 10.6%. This marks a doubling of retail shareholders over the past year.

Mazagon Dock Shares Dive 8.5% Ahead of Historic Stock Split  On the other hand, foreign portfolio investors have reduced their stake from 2.44% in June to 1.45% by September, while mutual funds, which own less than 1% of the company, slightly increased their holdings from 0.68% to 0.76% during the same period.

Despite the recent decline, the stock has appreciated 120% over the last year, although it is currently down 26% from its record high of Rs 5,860 reached in July. As of September, the government retains an 84.83% stake in the company, exceeding the minimum public shareholding requirement of 75%.

On Tuesday, October 22, shares of Mazagon Dock Shipbuilders Ltd. dropped by as much as 8.5% ahead of a board meeting to discuss a potential stock split, marking the first time the company will consider such a move in its trading history. Although Mazagon Dock has previously issued dividends, it has never conducted a stock split or distributed bonus shares.

The company’s shares have a face value of ₹10 each. Alongside the stock split, the board will also evaluate a dividend proposal for shareholders, following a final dividend of ₹12.11 per share declared for the financial year 2024.

Mazagon Dock Shares Dive 8.5% Ahead of Historic Stock Split  Retail shareholder numbers have surged, increasing from 4.64 lakh at the end of the June quarter to 6.56 lakh by the end of September. As a result, the proportion of retail shareholders—those with authorized share capital of less than ₹2 lakh—rose from 9% to 10.6% during the same period. Year-over-year, the number of retail shareholders has doubled from 3 lakh in September of last year to the current figure.

Conversely, Foreign Portfolio Investors have reduced their stake in Mazagon Dock from 2.44% in June to 1.45% by September. Indian mutual funds, which hold less than 1% of the company, slightly increased their share from 0.68% to 0.76% during that time.

Mazagon Dock shares reached a record high of ₹5,860 in July but are currently down 26% from that peak, trading at ₹4,269.95. Despite this correction, the stock has risen 125% over the past 12 months. According to the shareholding pattern as of September, the government maintains an 84.83% stake in the company, well above the minimum public shareholding requirement of 75%.