Bajaj Finance Bonus Issue and Stock Split: Implications for Shareholders

Bajaj Finance Bonus Issue and Stock Split Announcement

On April 29, Bajaj Finance made a significant announcement regarding its shareholder benefits, revealing a bonus issue and a stock split. The company declared a bonus issue of shares in a 4:1 ratio, marking its first bonus issue in nine years. In addition, it also announced a stock split in the ratio of 1:2, meaning each existing share will be divided into two.

These changes are expected to be executed on or before June 27, pending the necessary approvals. Bajaj Finance stated that the decision reflects the company’s strong financial position, robust reserves, and positive growth outlook.

What It Means for Shareholders

For existing shareholders, this means a significant increase in the number of shares they hold. For example, a shareholder owning 10 shares on the record date (which is yet to be announced) will receive 40 additional shares after the bonus issue in a 4:1 ratio, bringing the total to 50 shares. Following the stock split, these 50 shares will be converted into 100 shares at a 1:2 ratio.

This represents a substantial increase in the number of shares for existing investors. For reference, Bajaj Finance had previously carried out a stock split in 2016, splitting its shares in a 1:5 ratio.

Bajaj Finance Dividend Announcements

In addition to the bonus issue and stock split, Bajaj Finance has also announced a final dividend of Rs 44 per equity share and a special dividend of Rs 12 per equity share. This brings the total dividend for FY25 to Rs 56 per share.

• The record date for the final dividend is set for May 30, and it will be paid on or around July 28.

• The special interim dividend, linked to exceptional gains from the sale of an investment in Bajaj Housing Finance, will have a record date of May 9, with payment expected on or around May 26.

Bajaj Finance Q4FY25 Results

Bajaj Finance also released its results for the January-March quarter of FY25 on April 29. The company reported a 17% year-on-year growth in net profit, reaching Rs 4,480 crore, surpassing the market consensus estimate of Rs 4,400 crore.

• Revenue from operations for the quarter grew to Rs 18,457 crore.

• The company’s assets under management (AUM) surged 26%, driven by strong credit demand, while new loan bookings jumped 36% year-on-year.

• Net interest income increased by 22%, reaching Rs 9,807 crore, beating analyst expectations of Rs 9,660 crore.

Bajaj Finance Share Price History and Market Reaction

Despite the strong earnings results, Bajaj Finance’s stock saw a sharp decline of over 5%, closing at Rs 8,613.50 per share on April 29. Nevertheless, the stock has seen a 24% rise so far in 2025.

• HDFC Securities maintained a ‘Buy’ rating, though the earnings slightly missed their estimate.

• Motilal Oswal kept a ‘Neutral’ rating with a target price of Rs 10,000.

• Axis Securities remained bullish, raising its target price to Rs 10,500 per share.

Highlights

• Bonus issue in a 4:1 ratio, marking the first in nine years.

• Stock split in a 1:2 ratio, doubling the number of shares for shareholders.

• Total dividend of Rs 56 per share announced for FY25, with special and final dividends planned.

• Q4FY25 net profit rose 17% to Rs 4,480 crore, exceeding estimates.

• Despite positive earnings, Bajaj Finance shares dropped 5% on April 29, but have gained over 24% in 2025.