India Glycols Stock Split: Midcap chemical stock to sub-divide its equity in 2:1 ratio; what will investors get?

India Glycols Share Split News: Green chemical maker India Glycols' board on Friday approved a proposal to split the company's stock. Under the approved proposal, the midcap chemical stock will be split in a ratio of 2:1 (meaning a 'two for one' split). Under the arrangement, shareholders will get two equity shares for each equity share held.

At 11:37 am, the India Glycols stock was off its intraday low of Rs 1,881.1 apiece on BSE, quoting down 0.7 per cent for the day at Rs 1,898.4 apiece.

The stock began the day flat at Rs 1,912.5 and then gyrated within a range of Rs 64, between Rs 1,881 and Rs 1,945, in the first half of the day.

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India Glycols (INDIAGLYCO) share price news

The proposed India Glycols corporate action will divide the stock's face value to Rs 5 from the current Rs 5 per equity share.

Why has India Glycols decided to go for the share split?

According to a regulatory filing, the green chemical manufacturer is making this move with an aim to:

• Enhance the liquidity of its shares in the capital market
• Encourage wider investor participation

When will India Glycols share split take effect?

The company said the split will be executed tentatively within two months from the date of shareholder approval.

The proposal, cleared by the board, is subject to shareholders' and other necessary approvals.

What is a share split and why do companies decide to split their stocks?

A stock split is a type of corporate action that enables a listed company to divide its existing paid-up capital into a larger number of shares.

Described as a ratio, commonly known as 'stock split ratio', a share split increases the number of shares of a company available in the market.

For instance, a 5:1 (read as 'five for one') share split translates to the issuance of 5 new equity shares for each share held.

It is worth noting that the company's market capitalisation (mcap) remains unchanged during a share split.

Typically, a split makes the stock more affordable for a broader investor base, as it reduces the per unit price of the equity.