Pavna Industries Ltd.'s board of directors approved on Wednesday a proposal of it its first-ever stock split, according to an exchange filing.
The board considered and recommended a subdivision of one fully paid-up equity share of a face value of Rs 10 each into 10 equity shares of a face value of Re 1 each. The company is yet to announce the record date for the stock split, the filing stated.
A stock split is a corporate action where a company increases the number of outstanding shares by reducing the face value per share. This typically enhances liquidity as the stock price adjusts accordingly. While the number of shares increases, the total investment value remains unchanged.
To be eligible for a stock split, investors must hold shares as of the record date announced by the company. The record date determines who will receive additional shares post-split, based on the split ratio.
With India following the T+1 settlement cycle, investors need to purchase the stock at least one trading day before the record date to be eligible. Buying shares on the record date itself won’t qualify, as the ownership won’t be reflected in time.
Pavna Industries is part of the Pavna Group and was established as a key OEM supplier for the Indian automotive industry. In 2024 the company signed an agreement with EV player Ola Electric to supply auto components, marking an entry into the domestic EV sector.
Pavna Industries shares closed 0.62% lower at Rs 415.10 per share. This compares with a 0.35% decline in the benchmark Nifty 50. It has fallen 20.68% in the last 12 months and 15.80% year-to-date.
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