Silver Touch Technologies Announces 1:5 Stock Split, 1:1 Bonus After 135% Rally

Introduction to Corporate Actions

Silver Touch Technologies Limited announced a significant capital restructuring plan following a board meeting on January 16, 2026. The board has approved a 1-for-5 stock split and a 1-for-1 bonus issue, the first such corporate actions by the company in over two decades. These decisions come at a time when the small-cap IT stock has delivered a remarkable 135% return to its investors over the past year, signaling strong market confidence.

Details of the Stock Split

The board has approved the sub-division, or stock split, of its equity shares in a 1:5 ratio. This means each existing equity share with a face value of ₹10 will be subdivided into five equity shares, each with a face value of ₹2. The primary goal of this action is to increase the liquidity of the company's shares in the stock market and make them more affordable for retail investors, thereby encouraging wider public participation. The total number of shares will increase, but the market capitalization will remain unchanged immediately following the split.

Understanding the Bonus Issue

In addition to the stock split, the company has declared a bonus issue in a 1:1 ratio. This means that for every one share an investor holds (post-split, with a face value of ₹2), they will receive one additional bonus share. The bonus shares will be issued out of the company's free reserves. The company has confirmed that it requires ₹12.68 crores from its free reserves to facilitate this bonus issue. As of March 31, 2025, Silver Touch Technologies had free reserves amounting to ₹118.12 crores, which is more than sufficient to cover this action.

Increase in Authorized Share Capital

To accommodate the new shares from the split and bonus issue, the board has also approved an increase in the company's authorized share capital. The current authorized capital of ₹16 crores will be increased by an additional ₹30 crores. This will bring the total authorized share capital to ₹46 crores, comprising 23,00,00,000 equity shares with a face value of ₹2 each. This move provides the company with the flexibility for future capital-raising activities if needed.

Exceptional Stock Performance

The announcement of these corporate actions is backed by the stock's stellar performance. Silver Touch Technologies has emerged as a multibagger, rewarding investors with substantial gains across various time horizons. The stock has rallied 135.10% in the last year and over 81% in the past month alone. On the day of the announcement, the share price was trading nearly 5% higher at ₹1,598.00 on the BSE, reflecting a positive market reception to the news.

Approval Process and Timeline

All the proposed changes, including the stock split, bonus issue, and increase in authorized capital, are subject to the approval of the company's shareholders. The approval will be sought through a postal ballot and e-voting process. The board has appointed M/s. Sandip Sheth & Associates, Practicing Company Secretaries, to act as the scrutinizer for this process. The company anticipates completing all necessary procedures by March 15, 2026. The record date for determining shareholder eligibility for the stock split and bonus issue will be announced at a later date.

Conclusion

Silver Touch Technologies' decision to implement a stock split and bonus issue is a strategic move aimed at rewarding shareholders and improving stock liquidity. Backed by strong financial performance and a significant rally in its share price, these actions are poised to make the stock more accessible to a broader base of investors. The completion of these actions is now contingent on shareholder approval, with a clear timeline set for March 2026.