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Why do companies opt for a stock split?

Stock splits are done for a number of reasons. There are, however, two that are the most common. The first has to do with a company’s perceived liquidity. When the price of each share falls by a particular amount – based on the ratio chosen by the firm – investors perceive the company’s stock as more inexpensive and are thus more likely to purchase shares. The lower the stock’s price, the less hazardous it appears.

If you own a stock that splits, you will have more shares after the split. The price per share, on the other hand, is falling. This is due to the fact that the market capitalization is unchanged. As a result, even while the price per share drops, the total number of shares grows. The outstanding shares of a firm are multiplied by the current market price to calculate market capitalisation.

Stock Split of Anupam Finserv

Anupam Finserv, founded in 1991, is a Small Cap business in the Financial Services industry with a market capitalization of Rs 20.45 crore. The company’s yearly sales growth of 31.08 percent surpassed its three-year compound annual growth rate (CAGR) of 4.76 percent. The stock returned 34.27 percent over three years, compared to 67.21 percent for the Nifty Smallcap 100.

From October 6, 2021, Anupam Finserv will split the face value once. In 2016, Anupam Finserv Ltd. divided the face value of its shares from Rs 10 to Rs 1 for the first time. From October 6, 2021, the stock will be trading ex-split.

Stock Split of Alphalogic Techsys

Alphalogic Techsys, founded in the year 2018, is a Small Cap business in the IT Software industry with a market capitalization of Rs 56.49 crore. Sales have decreased by 43.79 percent. For the first time in three years, the company’s revenue has decreased.

Since October 5, 2021, Alphalogic Techsys Ltd. will split the face value once. In 2016, Alphalogic Techsys Ltd. split the face value of its shares from Rs 10 to Rs 5. Since October 5, 2021, the stock has been trading ex-split.

Stock Split of Affle (India)

Affle, founded in 1994, is a Mid Cap business in the Services sector with a market capitalization of Rs 14,151.66 crore. On August 26, 2021, a stock split from a face value of 10.0 to a face value of 2.0 was announced, with a record date of 2021-10-08. When compared to the stated net profit of Rs 134.8 crore, the operating cash flow of Rs 101.62 crore is 0.75 times. The company spent Rs 174.84 crore on investing activities, up 7.43 percent year on year.

Stock Split of DCM Shriram Industries

DCM Shriram Industries, founded in 1989, is a Sugar-related Small Cap company with a market capitalization of Rs 840.87 crore. On June 29, 2021, a stock split from a face value of 10.0 to a face value of 2.0 was announced, with a record date of 2021-10-11. The stock returned 203.2 percent over three years, compared to 67.21 percent for the Nifty Smallcap 100. From October 8, 2021, the stock will trade on an ex-split basis.

Stock Split of JTL Infra

JTL Infra, founded in 1991, is a Small Cap business in the Metals – Ferrous sector with a market capitalization of Rs 948.30 Crore. The company’s yearly revenue growth rate of 89.26% surpassed its three-year CAGR of 36.91%.

The stock returned 645.64 percent over three years, compared to 67.21 percent for the Nifty Smallcap 100. Over a three-year period, the stock returned 645.64 percent, while the Nifty Metal provided investors a 49.83 percent gain.

From October 13, 2021, JTL Infra will split the face value to 1. From October 13, 2021, the stock will trade on an ex-split basis.

Zeal Aqua

Zeal Aqua, founded in 2015, is a Small Cap company in the Aquaculture industry with a market capitalization of Rs 100.79 crore. The company has enough cash on hand to cover its contingent liabilities. Stock returned -47.91 percent over three years, compared to 67.21 percent for the Nifty Smallcap 100.

Since October 14, 2021, Zeal Aqua will split the face value once. From October 14, 2021, the stock will trade on an ex-split basis.

Upcoming Stock Split In October; Check Record Date And Other Details

Upcoming Stock Split In October

Company Name	Record Date	FV Changed From	FV Changed To
Zeal Aqua	14-Oct-2021	10	1
JTL Infra	13-Oct-2021	10	2
DCM Shriram Inds.	08-Oct-2021	10	2
Affle (India)	07-Oct-2021	10	2
Tirupati Forge	07-Oct-2021	10	2
Anupam Finserv	06-Oct-2021	10	1
Alphalogic Techsys	05-Oct-2021	10	5

Disclaimer

Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage houses are not liable for any losses caused as a result of decisions based on the article. The above article is for informational purposes only.

Personal Finance

oi-Kuntala Sarkar

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Published: Wednesday, September 29, 2021, 13:11 [IST]

Public Provident Fund or commonly known as PPF accounts are secured savings options with fixed income, by the government. A Post Office PPF account will fetch you similar kinds of features like PPF accounts in other banks. People in rural or remote areas are more inclined towards Post Office PPF accounts because of the better reach of this public office. Even where banks are not available, a person can open a PPF account in the Post Office and can avail same features, offered by SBI or other banks. However, citizens living in the urban areas can also choose to open a Post Office PPF account, because of similar facilities and promising interests. PPF accounts generally offer far better interests than other saving accounts. A PPF account can be opened online or offline; the online form will be available on the Post Office or bank websites.

A PPF account provides the facility of both fixed and flexible deposits. It means you can deposit the money any time in an FY, with no burden of mandatory investments. In case you have a fixed income monthly and you are open to regular or systematic investments, you can deposit the money regularly. You can link your PPF account to another savings account, from where a fixed amount of money will be deposited to your PPF account regularly.

Interest rates

A PPF account will attract a 7.1% per annum (compounded yearly) as mandated by the RBI, and you will receive the total interest amount at the end of each FY. In a PPF account, you can deposit money any time in a year, you have to maintain a minimum balance of Rs. 500 and maximum Rs. 1,50,000 in an (financial year) FY. If one fails to deposit a minimum of Rs. 500 in an FY, the PPF account will be discontinued. The Post Office official website informs, “Discontinued account can be revived by the depositor before the maturity of the account by deposit minimum subscription (that is, Rs. 500) + Rs. 50 s default fee for each defaulted year.”

You can make the deposits in lump-sum or installments, according to your conveniences by cash or cheque or pay online. The deposits will qualify for deduction under section 80C of the Income Tax Act, the term interests or the lump sum interest, both will be tax-free – making it a lucrative investment. You can take only one withdrawal up to 50% of the balance, in an FY after 5 years, excluding the year of account opening.

Yearly deposit (INR)	Interest rate	Tenure (lock-in period)	Total deposit amount after maturity	Total interest after maturity	Total maturity amount
10000	7.10%	15 years	150000	121214	271214
25000	7.10%	15 years	375000	303035	678035
100000	7.10%	15 years	1500000	1212140	2712140

The interest rate in the present quarter was remained the same as the previous quarter by the government; the rate changes every 3 months (quarterly).

Application regulation

A single adult who is an Indian resident can open a PPF account with a nominee, but a parent can also open a PPF account on behalf of a minor or your child or a person of unsound mind. You can open only one PPF account in a Post Office or a bank.

Maturity and account closure

Your PPF account will be mature after 15 FYs, excluding the FY of account opening. At that time either you can take the maturity payment and close the account, or you can retain maturity value in the account further without deposit. In the latter case, the PPF interest rate will be applicable and payment can be taken any time or can take 1 withdrawal in each FY. Or, you can also extend the account at Post Office or bank for 5 more years and so on, within 1 year of the maturity. However, premature closure is only allowed after 5 years, but at the time of premature closure, 1% interest shall be deducted.

Story first published: Wednesday, September 29, 2021, 13:11 [IST]