Bajaj Auto rose 1.75% to Rs 3638 after the company said that it would endeavour to arrive at a dividend pay-out as a percentage of profits after tax based on the company's standalone financials.
Prior to the amendment, the policy referred to "dividend pay-out of around 50% of profits after tax on standalone financials, to the extent possible".Following the changes, the company's board will endeavor to arrive at a dividend pay-out as a percentage of profits after tax on the company's standalone financials, taking into account the surplus funds available with the company.
The dividend distribution will be up to 50% in case of surplus funds of up to Rs 7,500 crore, up to 70% if it is between Rs 7,500 crore to Rs 15,000 crore and up to 90% if it is above Rs 15,000 crore.
Surplus funds for this purpose comprises investments in financial assets other than in equity shares of group companies and strategic investments, the company said.
"The final dividend will be recommended by the Board for approval of the shareholders in a general meeting, while interim dividend, if any, may be declared by the Board. The company currently has only one class of shares, i.e. equity shares," it added.
Bajaj Auto is the world's third largest manufacturer of motorcycles and the largest manufacturer of three wheelers. It has its manufacturing facilities located at Chakan near Pune, Waluj near Aurangabad, and at Pantnagar in Uttarakhand.
The company's consolidated net profit jumped 29.8% to Rs 1,716.26 crore on 17.4% surge in net sales to Rs 8,730.10 crore in Q3 December 2020 over Q3 December 2019.
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