1:2 Bonus Issue, 1:2 Stock Split: 1000 shares will turn into 3000—Do you own?

1:2 Bonus Issue, 1:2 Stock Split: R&B Denims Limited has approved a 1:2 bonus share issue and a 1:2 stock split, according to an exchange filing. The decisions are subject to shareholder approval and other regulatory clearances. The record date will be announced later.

1:2 Bonus issue

Under the bonus issue, shareholders will receive one fully paid-up equity share of Re. 1 each for every two existing shares held. This means a shareholder holding 1,000 shares will receive 500 additional shares, increasing the total holding to 1,500 shares.

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1:2 Stock split

The board has also approved a stock split. Each equity share with a face value of Rs 2 will be split into shares with a face value of Re. 1 each. This will increase the number of shares held by investors, but the overall value of their investment will remain unchanged.

For example, if a shareholder owns 1,000 shares with a face value of Rs 2 each, the holding will increase to 2,000 shares after the split, with each share having a face value of Re. 1.

1000 shares will become 3000

An investor holding 1,000 shares of R&B Denims Limited will see their total shareholding increase to 3,000 shares after the stock split and bonus issue.

First, the 1:2 stock split will double the number of shares from 1,000 to 2,000 shares, as each existing share will be split into two shares.

After this, the company’s 1:2 bonus issue will grant one additional share for every two shares held. Based on the post-split holding of 2,000 shares, the investor will receive 1,000 bonus shares.

As a result, the total number of shares held by the investor will increase from 1,000 shares to 3,000 shares after both the stock split and bonus issue.

Bonus issues and stock splits usually improve liquidity and make shares more affordable for retail investors. They do not change the company’s overall market value.

Revenue rises but profit declines year-on-year

R&B Denims reported an 18.65 per cent year-on-year rise in consolidated revenue to Rs 113.03 crore in Q3 FY26, compared with Rs 95.26 crore in the same quarter last year. Revenue rose marginally by 0.36 per cent quarter-on-quarter from Rs 112.63 crore.

However, consolidated net profit fell 17.92 per cent year-on-year to Rs 8.29 crore, compared with Rs 10.10 crore a year ago. On a sequential basis, profit rose 16.27 per cent from Rs 7.13 crore in Q2 FY26.

Basic earnings per share declined to Rs 0.92 in Q3 FY26 from Rs 1.12 in the year-ago quarter.

Core textile operations drive earnings

The company’s revenue continues to be driven mainly by its core textile business. Revenue from sale of products and services stood at Rs 111.14 crore, accounting for 98.33 per cent of total revenue. Other operating income contributed Rs 1.89 crore.

R&B Denims manufactures denim fabrics, yarns, and blended textiles. It operates through an integrated setup covering spinning, dyeing, weaving, and finishing.

Long-term growth and financial position

Over the past five years, the company’s revenue and net profit have grown at a compound annual growth rate of 7.39 per cent and 46.51 per cent, respectively.

Return ratios remain stable. Return on capital employed stands at 15.9 per cent, while return on equity is at 12.3 per cent. The company reported earnings per share of Rs 3.47 and a debt-to-equity ratio of 0.45x.

Share price performance

Shares of the small-cap textile company settled at Rs 187.69 on February 18, up Rs 3.15 or 1.71 per cent.