Investors watching the stock market for impending stock splits should be aware that four shares, Rama Steel Tubes Ltd, PDS Ltd, Alfavision Overseas (India) Limited, and Kritika Wires Ltd, will all undergo stock splits in the upcoming and leaving days of August. A stock split occurs when a firm reduces the face value of each share by a predefined ratio and issues more shares to its current shareholders. Following a stock split, the quantity of shares on the market increases, but an investor’s value of the investment in that particular stock remains unchanged.
What Does Stock Split Mean?
A stock split, also known as a stock division, increases the number of shares in a corporation. After a 2-for-1 split, for example, each investor will possess twice as many shares and each share will be worth half as much. A stock split lowers the market price of individual shares but does not affect the company’s overall market capitalization: stock dilution does not occur.
When the market price per share is so high that trading becomes unmanageable, a corporation may split its shares. One argument is that a very high share price may discourage small investors from purchasing the shares. Stock splits are often conducted following a significant increase in share price.
Upcoming Stock Splits to Consider
Rama Steel Tubes Ltd
In 2022, Rama Steel Tubes reduced the face value of its shares from Rs 5 to Rs 1. Since August 25, 2022, the share has been quoted ex-split. Rama Steel Tubes Ltd shares finished Friday at 574.85, up 5.00% from the previous close. The company has provided a multibagger return of 135.88% over the previous year, and it has gained 61.45% year to date in 2022.
PDS Limited In 2022, PDS reduced the face value of its shares from Rs 10 to Rs 2. Since August 26, 2022, the share has been quoted ex-split. PDS Limited shares finished at 1,700.00 on the NSE on Friday, down 1.81% from the previous close. So far in 2022, the stock has gained 0.81% year to date.
Alfavision Overseas (India) Limited
Alfavision Overseas (India) has set August 29, 2022 as the record date for the subdivision/split of the face value of the Company’s share capital from Rs. 10/- per share to Rs. 1/- per share. On Friday, Alfavision Overseas (India) Limited finished at 261.25 per share, up 3.61% from the previous close. The stock has produced a multibagger return of 575.94% in the previous year, and on a YTD basis, the stock has given a multibagger return of 109.50% in 2022.
Kritika Wires Ltd
Since August 30, 2022, Kritika Wires Ltd. has divided the face value once. In 2016, Kritika Wires Ltd. reduced the face value of its shares from Rs 10 to Rs 2. The stock has been quoted ex-split since August 30, 2022. Kritika Wires Ltd finished Friday at 105.55 per share, up 4.97% from the previous closing of 100.55 per share. So far in 2022, the stock has gained 81.83% year to date.
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