Stock split
Also called: share split, split
Dividing each existing share into several shares with a proportionally lower face value and price, without changing the company's value.
In a split, a share with a face value of ₹10 might become five shares of ₹2 each. The number of shares rises and the price adjusts down in proportion, so the value of a holding and the company's market capitalisation are unchanged.
Example
Twenty shares at ₹2,500 become 100 shares at about ₹500 after a 1-into-5 split, still worth ₹50,000.
Learn more in these lessons
- Dividends, splits, bonus shares and other corporate actionsWhat happens to my shares in a split, bonus issue or rights issue?
- Adjusted and unadjusted pricesWhy are the old prices on a chart sometimes different from the prices that traded?
Related terms
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