Shares of Bajaj Finserv climbed 6.53% to Rs 13,443.50 in intraday trading today on Tuesday. This rise in the shares of the company has come after the news in which there has been talk of a stock split. In fact, the company has informed that the Board of Directors of Bajaj Finserv will consider the proposal for divestment of equity shares of the company on Thursday. Through a share split, the company will increase the number of outstanding shares, while reducing the price of each share. This will not affect the overall market cap of the company.
Quarterly results to be released
Bajaj Finserv said in a communication sent to the stock exchanges on Monday that the proposal for splitting of Rs 5 face value shares will be considered in the meeting of the Board of Directors on July 28. Apart from this, a proposal to issue fully paid-up equity shares to the shareholders will also be considered in the meeting. Bajaj Finserv will also announce its quarterly results on the same day.
What is Stock Split?
Actually, through stock split, the stock is sub-divided. This lowers the stock price for investors. Usually it aims to woo the small investors. However, the market capitalization of the company does not change. Not only this, a stock split increases the number of outstanding shares by issuing more shares to the existing shareholders.