HDFC AMC share price may show a 50% drop today; here's why - should you buy?

HDFC AMC trades ex-bonus: HDFC Asset Management Company (HDFC AMC) shares are in focus today, November 26, as the stock begins trading ex-bonus following the company’s recently announced 1:1 bonus share issue. This is the first bonus issue from HDFC AMC since it became a listed entity, marking a significant milestone for investors of the country’s third-largest asset management firm.

The company had earlier approved issuing one bonus share for every one fully paid-up share held by eligible shareholders. In line with stock exchange regulations, HDFC AMC turned ex-bonus one trading day before the record date, making Tuesday, November 25, the last day to buy shares and qualify for bonus entitlement. Only shareholders whose holdings were reflected at the end of Tuesday’s trading session are eligible to receive the bonus shares.

Price Could Appear to Fall 50%, But It’s Only Optical

With the stock now trading ex-bonus, its market price will adjust accordingly. On a 1:1 bonus, the number of outstanding shares doubles, which typically results in the trading price appearing to fall by around 50%. Some trading apps may display this as a steep decline, but investors need not be alarmed—this drop is purely mathematical and not a reflection of business performance.

Bonus issues do not dilute the value of an investor’s total holding. Instead, they increase the number of shares while adjusting the price proportionately. Importantly, the company confirmed that 21,40,03,751 bonus equity shares will be issued, drawn from the Capital Redemption Reserve Account and Securities Premium Account as of September 30.

Bonus issues reduce free reserves and lower earnings per share (EPS), but shareholder ownership remains unchanged.

HDFC AMC Share Performance

HDFC AMC’s stock has delivered a solid performance over the past year. It has gained 27.54% in the last twelve months, reflecting strong institutional interest and steady operational performance. On a year-to-date basis, the stock has risen 29.36%, maintaining its upward momentum in 2025.

However, the shorter-term trend shows some consolidation. The stock is up 11.93% over the last six months but has slipped 7.59% in the three-month period. In the most recent one-month window, the stock has fallen 2.83%, signalling a cooldown ahead of the ex-bonus date.

Despite near-term volatility, HDFC AMC remains a strong wealth creator—the stock is up nearly 5x from its IPO price of ₹1,100 per share.

Bonus Issue Details and What Investors Should Know

In its exchange filing, the company stated:

“Issuance of bonus Equity Shares in the ratio of 1:1 i.e. 1 (One) new fully paid-up Equity Share of ₹5 each for every 1 (one) fully paid-up Equity Share of ₹5 each, to the Members of the Company as on the record date.”

This means that the number of shares in investors’ demat accounts will double. For example, a shareholder holding 100 shares as of Tuesday’s close will now receive 100 additional shares, taking the total to 200 shares, while the market-adjusted price ensures the value of the investment stays unchanged.

The record date to determine eligible shareholders is Wednesday, November 26, 2025. As a result, the stock is trading ex-bonus today, reflecting the adjustment.

Bonus corporate actions like this are commonly used to reward shareholders, improve liquidity, and make the stock more affordable for a wider investor base. HDFC AMC said that additional procedural details, including credit timelines for the bonus shares, will be announced shortly.

With this move, HDFC AMC joins a list of prominent companies—Patanjali Foods, Fineotex Chemical, Shilpa Medicare, HDFC Bank, Bajaj Finance, Ashok Leyland, Samvardhana Motherson International, Nestle India, Container Corporation of India, Motherson Sumi Wiring, Anand Rathi Wealth, Indraprastha Gas and Garware Technical Fibres—that have issued bonus shares in 2025.

HDFC AMC: Should you buy?

Commenting on the recent 1:1 bonus issue, Seema Srivastava, Senior Research Analyst at SMC Global Securities said the move “signals management’s confidence in sustainable performance” and aligns with the company’s shareholder-friendly approach. She added that such actions typically improve affordability, deepen liquidity and draw wider retail participation.

With its debt-free balance sheet, high ROE, strong brand recall, extensive distribution network and the ongoing financialization-of-savings trend, Srivastava believes HDFC AMC remains well-positioned for “consistent compounding and long-term value creation.”

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 making any investment decisions.