Announcements

Indian Railways Catering and Tourism Corporation (IRCTC) conducted a meeting with its Board of Directors on 29th September, 2021. As per this meeting, it has declared to the Exchange that a stock split in the ratio of 5:1 i.e. for every 1 share you hold of IRCTC you’ll now hold 5 shares in your Demat account.

The record date for the purpose of determining shareholders who will be applicable for this is 29th October 2021.

What is a stock split?
It’s a corporate action where a company divides its existing shares into multiple new shares in order to increase the stock's liquidity. In other words, get more people to invest in the company at its true value.

How does this corporate action impact Futures & Options Contracts?

Impact on Futures Contract: 

• The adjusted futures price shall be arrived at by dividing the old futures price by the adjustment factor. 
• The adjusted market lot shall be arrived at by multiplying the old market lot by the adjustment factor. The revised market lot would be 1625

Impact on Options Contract: 

• The adjusted strike price shall be arrived at by dividing the old strike price by the adjustment factor.
• The adjusted market lot shall be arrived at by multiplying the old market lot by the adjustment factor. The revised market lot would be 1625

The adjustment factor for the stock split of IRCTC is (5/1) = 5, since the split ratio is 5:1.

Read more on this here.

For all positions taken before 28th October 2021, you may see a slight deviation in the carried forward (c/f) average price of IRCTC due to the corporate action mentioned above.