Nestle India is set to hold a board meeting on June 26, 2025, to consider and approve a proposal for issuing bonus shares, marking a potentially significant event for the fast-moving consumer goods (FMCG) giant. This would be the first bonus share issuance in the company's history since its listing on the Indian stock market. The announcement was made on June 19, 2025, after market hours, drawing considerable attention from investors and market analysts alike.
The upcoming board meeting holds substantial weight as the decision could influence the company's stock performance and investor sentiment. Bonus shares are additional shares given to existing shareholders free of cost, based on the number of shares they already own. This increases the total number of outstanding shares and can lead to a dilution in earnings per share (EPS), but it also signals the company's confidence in its future prospects and can enhance shareholder value over time.
Nestle India's shares closed 1.28% lower at ₹2,309.10 on Thursday, June 19, 2025, compared to the previous close of ₹2,339. The market capitalization of the FMCG giant stood at more than ₹2.22 lakh crore as of the same date. While the stock has given investors returns of over 43% in the last five years, it has seen a decline of 8.42% in the past year. Year-to-date, the stock has gained 6.64% in 2025.
In light of the impending board meeting, the trading window for dealing in the company's securities will remain closed from June 19, 2025, to June 28, 2025. This measure is to prevent insider trading and ensure fair market practices during the decision-making process.
Nestle India has a history of rewarding its investors. In January 2024, the company executed a stock split, dividing one share of ₹10 into ten shares of ₹1 each, which made the stock more accessible to retail investors. Since then, Nestle has announced dividend payouts five times, amounting to ₹42.5 per share. The board has also recommended a final dividend of ₹10 per share for FY25.
The company's financial performance remains robust. In the fourth quarter, Nestle India posted a net profit of ₹885.4 crore, with revenue from operations at ₹5,503 crore. The EBITDA for Q4 stood at ₹1,389 crore, with the EBITDA margin expanding to 25.2%.
Market analysts have mixed opinions on Nestle India's stock. According to Bloomberg data, out of 40 analysts, 10 have a 'buy' rating, 12 recommend 'hold,' and 18 suggest 'sell.' The average of 12-month analysts' price target implies a potential upside of 4.2%.
The promoters of Nestle India, Maggi Enterprises Ltd. and Nestle SA, are expected to benefit from the bonus issue, along with retail investors who hold up to 9 crore shares.
