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Business News/ Markets / Stock Markets/  1:1 bonus shares: Multibagger SME IPO turns 1.20 lakh into 10.80 lakh in three years
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1:1 bonus shares: Multibagger SME IPO turns ₹1.20 lakh into ₹10.80 lakh in three years

Multibagger IPO was launched at ₹40 apiece in September 2020

Multibagger stock listed on BSE at ₹40 and went on to end at ₹39.05 on the listing date, delivering zero return to its allottees. (HT)Premium
Multibagger stock listed on BSE at 40 and went on to end at 39.05 on the listing date, delivering zero return to its allottees. (HT)

Multibagger IPO: Atam Valves IPO (Initial Public Offering) is one of those fixed issues listed on BSE SME exchange that has delivered whopping return to its long term allottees despite having a par listing. The fixed SME issue was offered at a price of 40 apiece in September 2020 and one lot of the public issue comprised 3,000 shares. Eventhough, the BSE SME stock listed at issue price, it has ascended to the tune of 180 during Monday deals.

But, money is not in buying and selling of stocks. It's in wait. Means, one can maximise one's return by holding a quality stock as long as it can. During a long term hold, an investor enjoys benfit of other than stock appreciation as well. These benefits include, dividend payment, bonus shares, stock subdivision, buyback of shares, etc. Thse rewards may not look attractive at an immediate look, but in long term, these benefits help an investor's money to grow manyfolds.

Those who don't believe in above mentioned claim, they need to look at Atam Valves IPO. This Multibagger SME IPO, as mentioned above was launched in September 2020 but opened at discount. But, those remained invested in the scrip till date after stock allotment, their 1.20n lakh has turned to 10.80 lakh today. The SME stock has risen to the tune of 180 apiece levels. But, the company issued 1:1 bonus shares in these three years, that worked as icing on the cake.

Atam Valves bonus shares history

As per the information available on BSE website, Atam Valves shares traded ex-bonus on 21st October 2022 for issuance of bonus shares in 1:1 ratio. This means, one bonus shares were issued to the eligible shareholders of the company for every one share they held on the record date.

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So, if an allottee had remained invested in this stock after share allocation, its shareholding in the stock would have doubled and total shares would have gone to 6,000 (3,000 x2).

1.20 lakh turns to 10.80 lakh

As one lot of the IPO was comprising 3,000 shares and one share was offered at 40 apiece. An allottee's minimum investment in the SME IPO would have been 1.20 lakh ( 40 x 3000). Atam Valves share price today is around 180.

So, if an allottee had remained invested in this multibagger SME IPO till date after allotment of shares, the absolute value of 1.20 lakh would have turned to 10.80 lakh ( 180 x 6000).

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Asit Manohar
Chief Content Producer at Live Mint Digital Team
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Updated: 25 Sep 2023, 02:42 PM IST
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