Upcoming Stock Splits in March 2023

On the face of it, ‘stock split’ may sound unpleasant. You may wonder what happens when a company splits shares. Will you have to forgo your shares or will their value reduce? Will your investment portfolio drop in value when a company splits stocks?

Fret not! A stock split is neither good news nor bad. Companies often split their shares when the stock becomes expensive in absolute terms. This allows more retail investors to buy them and improves liquidity in the market.

Before understanding the consequences of a stock split on the stock price and market capitalisation of a company and your voting right, here’s a list of companies that have announced stock splits this month.

List of Upcoming stock splits in March 2023

Brief on companies going for stock split

Vivanta Industries Ltd (VIL)

Vivanta Industries Limited offers engineering services such as land survey and procurement, project designing, funding, marketing services and fiscal studies.

Financial health check:

Over the last 5 years,

1. Its revenue has grown at an annual rate of 54.07% compared to the industry average of 7.66%
2. Its debt-to-equity ratio has been 34.98% compared to the industry average of 34.47%
3. Its current ratio has been 37.52% compared to the industry average of 171.09%

Shree Securities Limited

Shree Securities Limited is a Non-banking Financial Company (NBFC). They offer customised, reliable, fast, quality, and cost-effective solutions to customers. It is listed on the Bombay Stock Exchange Ltd and the Calcutta Stock Exchange Ltd.

Financial health check:

Over the last 5 years:

1. Its revenue has grown at an annual rate of -36.01% compared to the industry average of 10%
2. Its net income has grown at an annual rate of 37.97% as against the industry average of -17.94%
3. Its current ratio has been 2724.23% compared to the industry average of 42.99%

Osia Hyper Retail

Osia Hyper Retail Ltd is an Ahmedabad-based emerging supermarket chain focusing on value-retailing.

Financial health check:

Over the last 5 years,

1. Its revenue has grown at an annual rate of 44.07% vs the industry average of 16.2%
2. Its market share has increased from 0.27% to 1.54%
3. Its net income has grown at an annual rate of 59.02% versus the industry avg of 24.6%
4. Its debt-to-equity ratio has been 94.75% compared to the industry average of 57.43%
5. Its current ratio has been 141.81%, vs the industry average of 129.49%

K.P. Energy

The company is engaged in the business of windmill infrastructure development. It caters to the end-to-end project life-cycle of a wind project, offering solutions starting from the concept till the completion stage.

Financial health check

1. Its revenue has risen at an annual rate of 17.57% compared to the industry average of 4.03%
2. Its market share grew from 0.54% to 0.98%
3. Its net income has increased at an annual rate of 1.75% versus the industry average of 9.69%
4. Its debt-to-equity ratio has been 55.04% as against the industry average of 107.33%
5. Its current ratio has been 138.2% versus the industry average of 101.19%

Rhetan TMT Limited

Rhetan TMT Limited manufactures and supplies steel-related products and services. Its products include TMT and round bars, which are used in the construction of bridges, dams, residential and commercial towers, and infrastructure projects.

Guj Toolroom

Gujarat Toolroom Limited is a construction company of residential buildings. The Company has not generated revenue.

Financial health check:

Over the last 5 years,

1. Debt to equity ratio has been 74.49% compared to the industry average of 201.25%
2. Its current ratio has been 153.97% versus the industry average of 109.19%

Captain Pipes

They are a leading manufacturer and exporter of PVC pipes. Captain Pipes offer piping solutions for agriculture, plumbing and drainage.

Financial health check:

Over the last 5 years,

1. Revenue has grown at an annual rate of 10.42% compared to the industry average of 6.92%
2. Its market share increased from 0.39% to 0.47%

360 ONE WAM Limited

Formerly known as IIFL Wealth Management Limited, the company is primarily engaged in wealth and asset management services like broking, credit, lending, financial asset distribution, investment solutions, and asset/portfolio management.

Financial health check:

Over the last 5 years,

1. Its revenue has risen at an annual rate of 36.11% compared to the industry average of 12.9%
2. Its market share rose from 2.06% to 5.24%
3. Its net income has increased at an annual rate of 46.22% versus the industry average of 11.63%

What is a stock split?

A stock split means a company divides its issued share capital into a higher number of shares while reducing the price per share. The company determines its split ratio and issues additional shares to its existing shareholders in order to increase its outstanding capital.

Impact of stock split

1. A stock split doesn’t change the company’s market capitalisation or your investment. It decreases the value of an individual share
2. Split stocks keep your stake in a company unchanged, so there’s no dilution in your voting rights
3. After a stock split, the outstanding shares increase and this may proportionally lower the share price.

Conclusion

Your stake and voting right remain intact even if the value of your share is split. It only means that you hold an increased number of shares compared to before.

Therefore, if you are planning to buy any of the above shares for the sole reason of a stock split, reconsider! Stock splits are no guarantee that the company’s fundamentals have gotten better. So base your investment decision on research and evaluation.

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Disclaimer: This article is written for educational purposes only. The securities quoted are only examples and not recommendations.