Majesco, a tech service provider for insurance cos in India, just declared nearly 20,000% in dividend
- The insurance technology firm Majesco Limited approved payment of an interim dividend of ₹974 per equity share for the financial year 2020-21.
- Post the announcement; the stock jumped in trade after more than doubling in value in the last 12 months.
- In the second quarter ending September 30, the company recorded 113.9% growth in its operating profit to ₹30 crore.
Based on the ruling market price, the dividend yield works out to 19480% for the share of the face value of ₹5 each.
The company, which sells software, consulting and services to the insurance industry, said the interim dividend payout translates to an amount of ₹2,788.4 crore on a shareholder base of 28.577 million shares. “The balance cash reserves estimated at ₹103 crore will be distributed subject to board and regulatory approvals,” the company said in a statement to the exchanges.
AdvertisementNot surprisingly, the stock jumped in trade after more than doubling in value in the last 12 months.
The last 16% of the rally came after the company announced a ₹630 crore share buyback— about 25% of the shares floating in the market at a price of ₹845— in October this year.
However, the bigger chunk of the spike in the stock came in July when it decided to sell its US subsidiary to another company in Delaware. The stake sale got Majesco over ₹3,000 crore in the second quarter helping the company to double its operating profit to ₹30 crore.
Analysts at HDFC Securities have given a buy rating to Majesco with a target price of ₹1,050.
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