A stock split is when a company divides its existing shares into multiple shares to make them more affordable for small investors. Common split ratios are 1:2, 1:3, and 2:3. For example, HDFC shares priced at Rs. 3011.45 split 1:5 to Rs. 621.20 per share, and ITC shares priced at Rs. 905.80 split 1:10 to Rs. 93.50 per share. While a stock split decreases the share price, it does not affect the company's overall market capitalization or underlying fundamentals.

1. STOCK SPLIT
By: Ravi Shankar Azad
09214017

2. What is Stock Split?
Company
Net worth = Rs 8
Stock Split 1:2

3. WHY STOCK SPLITS?
The prime intention behind the stock split are:
1) To enhance liquidity in the stock.
2) To make the stock more affordable.
Ratio 1:2, 1:3 and 2:3 are most common.

4. Examples
Company Share price Before Spilt Split Ratio Share Price after Spilt
HDFC Rs 3011.45 1:5 Rs 621.20
ITC Rs 905.80 1:10 Rs 93.50
Ranbaxy Rs 1039.55 1:2 Rs 504.40

5. Conclusion:
Mostly fundamentals of the company and
investors’ sentiments towards the company give
direction to the stock price after the split