Stock splits could be a reason for cheer, worry too
stock splits, with some stocks trading as low as ₹1.
Stock splits are intended to reduce the price of shares, making them more accessible to retail investors. However, several Indian small-cap companies have misused this mechanism, using it as a significant milestone to artificially inflate their stock prices.
Between 2010 and 2020, an average of 48 companies per year opted for stock splits. However, in 2024, a record 152 companies announced stock splits, compared to 83 companies in 2023, 103 in 2022, and 82 in 2021. Interestingly about 88 companies that have announced stock splits in 2024 are currently trading below ₹10.
In 2025, eight companies have already announced their intention to reduce the face value. Among them, Softrak Venture Investment, trading at ₹42, announced a face value subdivision from ₹10 to ₹1. The stock has surged 57% over the past month, even as the Sensex declined by 6% during the same period.
Last week Mangalam Global Enterprise announced a sub-division of its shares from face value of ₹2 to ₹1. The stock which rallied 24% in the past one month is trading at ₹28.88. Similarly, a stock Pradhin which is trading at ₹25.5 announced a ₹10 to ₹1 stock split last week. AA Plus Trade did a stock split from ₹10 to ₹1 on January 8 and the stock is currently trading at ₹1.42.
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