Bajaj Finance Stock Split and Bonus Issue: Bajaj Finance, India’s largest non-banking financial company, recently made a delightful announcement for its shareholders. The company approved the stock split in the ratio of 1:2 and bonus issue in the ratio of 4:1 at its board meeting on April 29, 2025. This means that if you have one share, soon you will have ten shares! But do you know, it does not increase the amount of your investment, only the number of stocks in the portfolio increases. Yes, but it doesn’t matter. There is a difference, and we will know what happens if the amount of investment does not increase in the stock split and bonus issue.
So before we proceed, let us assume that you have 10 shares of Bajaj Finance Limited in your demat account with a face value of Rs 9624 per share, i.e., your total investment amounts to Rs 9624 × 10 = Rs 96,240.
What would be the difference after 1:2 stock split?
When any company announces a stock split. So, generally its spliting existing shares into parts. Bajaj Finance has announced a 1:2 split. And the face value per share of the company is Rs 2. That means you have 10 shares with a face value of Rs 2 per share, and after the split, you will get 1 more share for each share. That is, after doubling the number of shares, you will now have 10 × 2 = 20 shares.
Meaning the price of the share, which was Rs 9624 before the share split; after the split, it will be Rs 9624 ÷ 2 = Rs 4812 per share. You will now have 20 shares, which will be priced at around Rs 4812 per share. But the total value will remain the same: 20 shares × Rs 4812 = Rs 96,240.
This also reduces the price of the share, and more people can buy it.
What will be the difference after the 4:1 bonus issue?
Bajaj Finance has announced a 4:1 bonus issue, i.e., you will get 4 new bonus shares for every 1 share held by the company. So now you have 20 shares, so 20 × 4 = 80 bonus shares you will get. That is, now you will have 20 existing shares + 80 bonus shares = 100 shares. It is to be noted that the face value of each bonus share will be ₹1. And in this process the share price will also be adjusted. The share price will be directly close to 1/5. (Because 4 bonuses + 1 original = became a total of 5 shares). That means you will have 100 shares, but now the share price will be ₹4812 ÷ 5 = ₹962.40 per share.
Bajaj Finance Stock Split and Bonus Issue: Change in Portfolio?
After the 1:2 split and 4:1 bonus issue, you will now have 100 shares, which will be priced at around Rs 962.40 per share. But the total value will remain the same: 100 shares × Rs 962.40 = Rs 96,240, which was earlier. (We are not taking into account market fluctuations. )
Bajaj Finance announces a 2200% dividend.
The company has declared a final dividend of ₹44 on the face value of ₹2. The record date was May 30, 2025. That is, to get the dividend, you had to do it on or before May 30. So, as per the previous math, if you had 10 shares, the total dividend would be = 10 shares × Rs 44 / share = Rs 440. Dividend is given on the number of shares preceding the split and bonus shares.
Why are stock splits and bonus shares given?
A stock split is done because when the price of the stock goes too high (like ₹9624 right now), it becomes difficult for small investors to buy high-priced shares. After the price falls, the value of the stock declines. This increases the retail investor’s interest in the stock and increases liquidity in the market. As the demand increases, the trading volume also increases. And stock prices are rising.
By giving bonus shares, the company shows that it is financially strong. And when the shareholder gets more shares, the dividend can also increase going forward. This creates a good impression towards the company, and benefits in the long term.
Conclusion
When due to cheap share prices, Bajaj Finance’s stock split and bonus issue can attract investors. This allows new investors to enter the market. However, investing in the stock market can be risky. Therefore, before investing, consult your financial advisor and invest only after analyzing the market situation. Also, keep in mind that stock splits and bonus issues increase the number of shares, but it does not guarantee an immediate profit.
Disclaimer: This article is for general information. The dates and conditions of stock splits, bonus issues, and dividends may change from time to time. Be sure to check the latest information from Bajaj Finance’s official website or your broker before investing. Investing in the stock market is subject to risks.
