Shares of Pavna Industries were in the spotlight on Thursday, July 3, after the company’s board approved a 1:10 stock split, marking its first-ever sub-division of shares. This corporate action is intended to improve share affordability and liquidity, particularly among retail investors. The move comes on the back of a 400 percent rally in the stock over the past five years, positioning it as a multibagger.
Board Clears Stock Split Proposal
In a regulatory filing, Pavna Industries announced that its board of directors has approved the sub-division of one fully paid-up equity share with a face value of ₹10 into ten equity shares of Re 1 each, subject to shareholder approval. The record date for determining shareholder eligibility will be announced after the approval process is completed.
A stock split is a non-monetary corporate action that increases the number of shares by lowering their face value. While this does not impact the overall value of an investor’s holding, it typically boosts trading activity by making the shares more accessible to smaller investors. Investors must own shares at least one trading day before the record date to be eligible, owing to the T+1 settlement cycle in India.
Financial Performance Under Pressure
Despite its long-term rally, Pavna Industries has faced some recent earnings headwinds. For Q4 FY25, the company posted a net profit of ₹1.70 crore, a 37 percent decline from ₹2.68 crore reported in the same quarter of the previous year. Revenue also fell to ₹66.23 crore from ₹81.45 crore a year earlier.
For the full financial year, Pavna reported a consolidated profit of ₹7.37 crore, marking a 30 percent drop from ₹10.56 crore in FY24. Revenue also saw a marginal decline to ₹308.24 crore from ₹316.87 crore year-on-year.
Pavna Industries, a core member of the Pavna Group, is a key OEM supplier to India’s automotive sector. In 2024, the company entered the electric vehicle segment by signing a component supply agreement with Ola Electric, a strategic shift towards high-growth industries.
Stock Price Movement
Despite recent volatility, Pavna Industries has delivered strong long-term returns. Over the past five years, the stock has surged nearly 400 percent. However, in the past year, it has declined over 20 percent. In June, the stock rebounded 9.6 percent after gaining 25.8 percent in May. Earlier months were more turbulent, with a 13 percent drop in April, a modest 1.2 percent gain in March, and declines of 26 percent and 2.6 percent in February and January respectively.
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