Sterlite surprises with bonus, stock-split

MUMBAI Mon Apr 26, 2010 7:06pm IST

A stockbroker uses his terminal to trade at a brokerage firm in Mumbai September 30, 2008. REUTERS/Punit Paranjpe/Files

A stockbroker uses his terminal to trade at a brokerage firm in Mumbai September 30, 2008.

Credit: Reuters/Punit Paranjpe/Files

Related Topics

MUMBAI (Reuters) - Indian non-ferrous metals producer Sterlite Industries on Monday surprised the market with a bonus share issue and a stock split, sending its shares soaring by their highest in more than two months.

Sterlite, a unit of London-listed Vedanta Resources also beat market forecasts as quarterly net profit more than doubled on the back of strong sales as prices and volumes moved up.

"The bonus and stock split is definitely a surprise. But it has been overdue--they have a very strong balance sheet," said Ajay Parmar, head of research for institutional equities at Mumbai brokerage Emkay Global.

Sterlite said on Monday its board had approved a 1-for-1 bonus share issue and a 2-for-1 stock split.

Shares in the company, valued at $15 billion, rose to 842.50 rupees, up 5.95 percent--its biggest gain since Feb 3, in a Mumbai market that rose 0.3 percent.

The stock has slipped 2.2 percent so far in 2010, compared to a 1.6 percent rise in the main index.

Sterlite, which produces aluminium, copper, zinc and lead, reported March quarter net profit jumped to 13.81 billion rupees from 5.98 billion a year ago. Net sales rose to 71.11 billion, from 43.4 billion a year ago.

A Reuters poll of 13 brokerages had forecast Sterlite's quarterly net profit at 11.5 billion rupees, on net sales of 55.8 billion rupees.

Its aluminium segment saw a turnaround, reporting a profit compared with a loss last year. The zinc and lead segment, which contributes a third of turnover, saw profits surge as prices nearly doubled from a year ago.

(Reporting by Prashant Mehra; Editing by Surojit Gupta)

(For more business news on Reuters Money visit www.reutersmoney.in)

FILED UNDER:

Reuters Showcase

Legal Complaints

Legal Complaints

Government's payday from telecoms auction could be delayed  Full Article 

Running State Banks

Running State Banks

India signals private-sector bosses could run state-owned banks  Full Article 

India Forecast Raised

India Forecast Raised

S&P raises India's GDP forecasts, says it's a bright spot in Asia  Full Article 

StanChart CEO

StanChart CEO

StanChart picks ex-JPMorgan exec Winters as CEO to replace Sands  Full Article 

Wockhardt Plant

Wockhardt Plant

Wockhardt says FDA raises new concerns about Waluj plant  Full Article 

Banking Sector

Banking Sector

State-owned banks' capital needs may be higher - RBI deputy  Full Article 

Shares Sale

Shares Sale

Bharti Airtel says raised $310 mln through share sale in tower unit  Full Article 

Inflation Target

Inflation Target

India should meet RBI inflation target by Jan 2016 - RBI deputy  Full Article 

International Exchange

International Exchange

NSE plans to set up international exchange in Gujarat  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage