Tata Steel Shares Trade Ex-Split; Good Opportunity to Buy The Tata Stock?
Tata Steel shares started trading ex-split on Thursday ahead of its record date. The company has announced a stock split in the ratio of 10:1 on its equity shares. Tata Steel has fixed July 29 as the record date for a stock split of 10:1. Thereby, the shares will turn ex-split on July 28. The 10:1 ratio means Tata Steel will give 10 equity shares having a face value of Re 1 each on every one existing share having a face value of Rs 10 each.Tata Steel’s stock split is a 1:10 ratio, this means a shareholder’s one equity share in the company will increase to 10 shares and the price of the shares on the ex-split date will also decrease ahead. This will make a shareholder have more shares in the company at a cheaper price.In the Tata Steel case, the stock split will help the company to increase liquidity, thus beating the impact of rising commodity prices on profitability to some extent. It is also observed that when the share price of a company is high, it splits its stock to make the shares more affordable to small investors. Once the Tata Steel stock is altered and becomes cheaper, it will attract more investors and the trading volume will increase.