New Delhi: Canara Bank saw an increase in buying activity on Wednesday, coinciding with the stock's ex-split.
This event was pre-determined by the board of directors, who fixed the record date for the 1:5 stock split as May 15, 2024. After the split, Canara Bank shares closed at Rs 113.30 per share on NSE on Tuesday.
Today, the post-adjustment opening price was Rs 116.25 per share on NSE, reaching an intraday high of Rs 118.90 per share. This marks a 5 percent rise from Tuesday's adjusted close price of Rs 113.30 per share.
The Canara Bank board approved the sub-division of its equity shares earlier this year, noting that the move is intended to improve liquidity in the bank's shares and make them cheaper for regular investors, and increase the retail investor base.
The PSU lender registered an 18 percent jump in its standalone net profit at Rs 3,757 crore for the quarter ended March 2024, compared to Rs 3,174 crore posted in the same period last year.
The company's board has also recommended a dividend of Rs 16.10 per share, 161 percent of the face value each, for the financial year 2023-24.
Insights from stock market experts suggest that the stock split is likely to boost the trade volume of Canara Bank shares, which are still available at attractive valuations.
Post-split, the shares are available at a promising PE multiple of around 1.47, indicating the PSU bank's successful management of its cost of funding. These experts anticipate a further surge in Canara Bank shares in the post-stock split period, offering a potential opportunity for investors.
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