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Business News/ Markets / Stock Markets1 lakh turns to 17 cr in 20 years as auto stock gives bonus shares 5 times

₹1 lakh turns to ₹17 cr in 20 years as auto stock gives bonus shares 5 times

Bonus shares: On all 5 occasions, auto company has given 1 bonus share for every 2 shares held by the shareholders

In case, bonus shares were not announced, one's ₹1 lakh would have turned to ₹2.25 crore.  (HT)Premium
In case, bonus shares were not announced, one's 1 lakh would have turned to 2.25 crore.  (HT)

A long term stock market investor not just earn from appreciation in share price. It also earn from dividends, bonus, buyback of shares, etc. That's why most of the successful stock investors advise positional investors to hold a stock as long as one can because money is not in buying in selling of stocks but in wait. On how, a long term investor can get a whopping return, one needs to look at Samvardhana Motherson share price history. This auto component company's stock price has ascended from 0.55 apiece levels to 123.70 per share levels in last 20 years. The company has issued bonus shares on 5 occasions in this period that helped an investor's 1 lakh to turn near 17 crore in this period. However, in case the company had not announced any bonus shares in this period, this 1 lakh would have appreciated to the tune of 2.25 crore in these two decades.

Samvardhana Motherson bonus shares history

In last two decades, Samvardhana Motherson has announced bonus shares on 5 occasions issuing 1:2 bonus shares on each occasions. First time, it announced bonus shares in 1:2 ratio in October 2012. After that in last one decade, it has announced 1:2 bonus shares on four more occasions. Last time, when it announced 1:2 bonus shares was in October 2018.

Impact on investment

If an investor had invested 1 lakh in Samvardhana Motherson shares 20 years ago, it would have got 1,81,818 shares of the company. After 1:2 bonus shares issued in October 2012, net shareholding of the investor would have turned to 2,72,727. After that four more 1:2 bonus shares have been issued by the auto component company, which would have turned net shareholding of the investor to 13,80,678 [(1,00,000/0.55) x 1.5 x 1.5 x 1.5 x 1.5 x 1.5].

1 lakh turns to 17 lakh

As Samvardhana Motherson share price today is 123.70 on NSE, an investors 1 lakh would have turned to 17.07 ( 123.70 x 13,80,678) crore due to 5 bonus shares issued by the company in the ratio of 1:2.

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Asit Manohar
Chief Content Producer at Live Mint Digital Team
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
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Published: 10 Sep 2022, 07:45 AM IST
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