The FMCG heavyweight’s shares closed at Rs 2,235.60 on Thursday, August 7. On Friday morning, the stock opened at Rs 1,124.95, a 50% drop that aligns precisely with the 1:1 bonus share adjustment. The bonus issue effectively doubles the number of outstanding equity shares and adjusts the price accordingly.
According to the company, the bonus issue is aimed at enhancing stock liquidity and potentially improving affordability for retail investors. While such corporate actions do not impact a company’s fundamentals, they are often seen as a sign of management’s confidence and financial strength.
This marks the first bonus issue in Nestle India’s history, according to data from Trendlyne.
No value lost, just more shares
The total value of an investor’s holdings remains unchanged despite the drop in the per-share price. For instance, a shareholder holding 20 shares worth Rs 4,000 at Rs 200 each will now own 40 shares valued at around Rs 100 apiece, maintaining the same overall portfolio value.
However, the bonus shares have not yet been credited to demat accounts. The deemed allotment is scheduled for Tuesday, August 12, and trading in the bonus shares will begin on Wednesday, August 13.
Nestle India Q1 results
Earlier in July, Nestle India reported its Q1FY26 results, posting a 13.4% year-on-year decline in consolidated profit after tax to Rs 647 crore, down from Rs 747 crore a year ago. However, revenue from operations rose 6% YoY to Rs 5,096 crore.Also read | Explained: Nestle India 1:1 bonus issue; what it means for investors?
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