Shares of all seven listed PSUs of the Gujarat State Government including Gujarat Industrial Power, Gujarat State Fertilisers & Chemicals (GSFC), and Gujarat Alkalies & Chemicals were surging in the green on Wednesday.
What Happened: The surge in the state-controlled companies comes as the Gujarat government on Tuesday announced a new policy for dividends, bonus share issues, share buyback, etc. Now as per the new rule a minimum of 30% of net profits or 5% of net worth, whichever is higher will be the minimum level of dividend declared for shareholders.
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The government also mandated every state PSU having a net worth of at least Rs 2,000 crore and cash and bank balance of Rs 1,000 crore to exercise the option of share buyback. For stock split, the government policy states that when a PSU’s market price or book value exceeds 50 times its value the PSU will have to go for a stock split.
A PSU with a defined reserve and surplus equal to or more than 10 times their paid-up equity share capital will be required to issue bonus shares to their shareholders.
The new changes have cheered investors who have been racing to buy the stocks of the companies. Several Gujarat state PSU shares were surging over 10% on Wednesday.
Price Action: Here is how the Gujarat PSU stocks traded in the mid-market hours on Wednesday.
Gujarat Alkalies & Chemicals was up 11.14% to trade at ₹695.50.
Gujarat Industrial Power shares surged a massive 20% to hit the upper circuit at ₹91.10.
Gujarat State Fertilisers & Chemicals shares were up 15.88% to trade at ₹148.10.
Gujarat State Petronet shares surged 7.40% to trade at ₹285.25.
Shares of Gujarat Mineral Development Corporation were up 17.05% to trade at ₹155.80.
Gujarat Narmada Valley Fertilisers & Chemicals shares surged 7.81% to ₹572.45.
Gujarat State Financial Corporation shares were up 0.83% to trade at ₹6.10
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