Dr. Reddy’s Laboratories announced a 1:5 stock split on Saturday. This means each existing share with a face value of Rs 5 will be split into 5 shares with a face value of Re 1 each.
The company shared this decision with the stock exchanges, explaining that the change will be made by altering the Capital Clause of its Memorandum of Association. However, the record date for the stock split has not been announced yet and will be communicated later.
Additionally, each American Depositary Share (ADS) will still represent 1 equity share. This means the number of ADSs held by each holder will increase in proportion to the new equity shares.
This is the first stock split for Dr. Reddy’s in recent years. The company last split its shares in October 2001, from Rs 10 to Rs 5 per share.
In other news, Dr. Reddy’s reported a slight decrease of 0.8% in its June quarter profit after tax, totaling Rs 1,392 crore. However, the company’s revenue grew by 13.9%, reaching Rs 7,673 crore.
The company’s board also approved an investment in preference shares of its Swiss subsidiary, Dr. Reddy’s Laboratories SA, up to GBP 500 million. This fund will be used to acquire Nicotinell and related brands.
On Friday, Dr. Reddy’s shares closed 0.55% higher at Rs 6,892 on the BSE.
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