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[2008-05-30] Bank of Baroda planning to split shares
BANK of Baroda is planning to split its stock to increase the number of shares on the Uganda Securities Exchange, writes David Muwanga.
“The split will increase the number of shares available on the market. This will also increase liquidity in the shares available for trading,” the managing director, K.K Shukla, told a press conference at Workers House.
With a share split, shareholders get more shares at no cost.
Shukla said the market price of the bank’s share is sh3,910 from sh1,000 in January 2007.
Shukla said Baroda’s Price Earnings (PE) ratio was only 10 against the market price ratio of 20.
The PE ratio shows the relationship between the share price and the company’s net profit per share and is an indicator of whether the share is fairly valued or not.
“The low ratio in comparison to the market ratio implies the actual market price of our share should be more than two times its current price.”
He said the bank’s current market capitalisation was sh156.40b, which should have been more than sh300b.
