ITC up 2% on bonus issue proposal

ITC has moved up 2% to Rs 268, after the cigarettes maker announced its bonus issue plan.

The board of directors of the company will meet on 18 June to consider the bonus issue proposal. Earlier, in 2005, the company had issued bonus shares in a ratio of 1:2.

Meanwhile, the company had posted better than expected financial results for the quarter ended March 2010. The net profit increased 27% to Rs 1,028 crore for Q4FY10 against Rs 809 crore in same quarter of previous fiscal. Net sales grew 28% to Rs 5,054 crore (Rs 3,950 crore) during the quarter.

On full-year consolidated basis, the company posted 25% jump in net profit to Rs 4,168 crore in FY10, as compared to Rs 3,325 crore in previous fiscal, highest in last three fiscals. Net sales jumped by 16% to Rs 19,136 crore (Rs 16,556 crore) during the fiscal.

The board has recommended a special Centenary dividend of Rs 5.50 per ordinary share of Re 1/- each and a dividend of Rs 4.50 per ordinary share for the financial year ended March 31, 2010, taking total dividend of Rs 10 per share (1000%) for FY10, against Rs 37 (370%) dividend had paid for FY09.

The stock opened almost flat over its previous day's close, has touched low of Rs 257. The stock bounced back 5% from intra-day low level and is currently trading at day's high level on the BSE. The trading volume on the counter has zoomed by almost five-fold to 1.51 million equity shares changing hands as compared to an average 280,000 shares traded daily in the last two weeks.