D-Street will witness three key stock splits by Manbro Industries Ltd., V2 Retail Ltd., and Avax Apparels and Ornaments Ltd. this week. Investors eyeing benefits of the stock split should be aware of the record dates set by these companies.
Manbro Industries has set its record date as March 25, whereas V2 Retail's record date is March 26. Both companies are splitting their shares in the ratio of 10:1.
Avax Apparels has fixed its record date as March 27. The company will be splitting share in the ratio of 10:5. Accordingly, every one existing equity share of face value of Rs 10 each fully paid-up is sub-divided into two equity shares of face value of Rs 5 each fully paid-up.
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What Is A Stock Split?
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 increase, 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 during trade.
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