Effect of the stock split: Investing in stocks is like investing in a company. Therefore, you should try to hold a stock for as long as possible. This rule applies to both primary and secondary market investors. A long-term investor earns not only from rising stock prices but also from various other rewards that a listed company announces from time to time. These rewards can be in the form of bonus shares, share buybacks, stock splits, interim, special or final dividends, etc. At first glance, these rewards may not look lucrative, but in the long run, they help your money grow manifold.
To understand how these rewards affect your investment, you need to look at the performance of Thinkink Picturez shares. Originally listed as Oyeeee Media Ltd or OML, the company launched its public issue in August 2015 at a fixed price of ₹40 each. The fixed price issue has been proposed for listing on the BSE SME Exchange. A bidder could apply for the SME IPO in lots and one lot of the SME IPO comprised 3,000 company shares. Therefore, a minimum investment was required to apply for the SME IPO ₹1.20 lakh ( ₹40 x 3,000).
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Stock split effect
After listing on September 4, 2015, the SME stock was in base formation mode until December 2017. However, from then on, this SMB stock remained an ideal stock to buy on a decline for long-term investors. In 2018, SME stock traded without a split on April 17, as the company announced a 1-for-10 stock split. So, if a shareholder had remained invested in this SME stock after listing, his shareholding in the scrip would have increased to 30,000 (3,000 x 10).
₹1.20 lakh turns ₹21.90 lakh
Today's Thinkink Picturez share price is ₹73 each on BSE. If a beneficiary had remained invested in this share capital until today, the absolute value of his own share capital would have increased ₹1.20 lakh would have changed ₹21.90 lakh ( ₹73 x 30,000). However, this could only have been possible if the beneficiary had remained continuously invested in the SME share until today.
Thinkink Picturez Limited has pulled back the curtain on its latest masterpiece “Vicky Vidya ka Woh Wala Video”. With an ensemble cast that includes A-listers Rajkumar Rao, Tripti Dimri, Mallika Sherawat and Vijay Raaj, this cinematic extravaganza is all set to be a game-changer and a potential goldmine for investors.
Disclaimer: The above views and recommendations are those of individual analysts, experts and brokerage firms, not Mint. We recommend investors consult certified experts before making an investment decision.
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