 "Nestle")
Shares of Nestle India surged 5.5 per cent to a fresh high of Rs 25,699 on the BSE in Tuesday’s intra-day trade after the company fixed January 5, 2024 as the record date for its share split.
The stock crossed its previous all time high of 25,510, which was touched on December 12.
The company’s board on October 19 had approved the stock split in the ratio of 1:10 wherein 1 equity share of face value of Rs 10 will be divided into 10 equity shares of face value of Rs 1 each.
With a view to enhance the liquidity of company's equity shares and to encourage participation of retail investors by making equity shares of the company more affordable, the company has decided for stock split, Nestle India had said.
A stock split is a corporate action in which a company issues additional shares to shareholders, increasing the total shares by the specified ratio based on the shares they held previously.
Companies often choose to split their stock to lower its trading price to a more comfortable range for most investors and to increase the liquidity of trading in its shares.
Meanwhile, according to Motilal Oswal Financial Services, the long-term narratives for Nestle India's revenue and earnings growth are highly attractive.
India’s Packaged Foods segment offers strong growth opportunities. This is particularly true for Nestle India, which has a strong pedigree and distribution strength. The successful implementation of the company’s volume-led growth strategy in recent years provides confidence in its execution as well, it said.
