Can anyone tell why sub division is made and what its impact on share capital & prices of shares ???????????
Menu
Why Sub Division/Splitting of shares is Made?
Replies (6)
To increase the interest of samll investor & daily trading volume of share.
how increase the interest of small shareholder
Example: Currently market price of 1 of share of OMDC (Orissa Minerals, FV-Rs.10) is Rs.60,000/-, we need Rs.60,000/- to buy one share of OMDC. if it split share of fv of rs.10 to fv of rs.1 each than we need Rs.6,000/- (Rs.60000/10) to buy one share, which a small investor can afford.
HDFC bank is going to split its share from fv of Rs.10 to Rs.2 each. Current Market price is Rs.2500/- each. On record date one share will converted into FV of Rs.2 each and Market price will 1/5 of record date.
Thanks Vikash.
It means after splitting mkt price also divide into proportion of splitting.
Yes, after splitting mkt price of share also divide into proportion of splitting.
Recent Threads
- ITR 2 Processed and Refund Credited to Bank
- Freelancer or Salaried
- LTCG Tax & Indexation on Debt Mutual Funds Sol
- Section 45(5A) and 194IC with carry forward of tds
- Paid tax amount, CIN generated and challan downloa
- INTRADAY INCOME PRESUMPTIVE INCOME
- Clarification on Deemed Export Status for EOU-to-E
- LTCG Tax on property
- Short term gain in itr2, missing 111A
- Errors in ITR Filing: Minimum One Character Requir
Related Threads
CAclubindia
