3 Stocks with Split Announcement and Good Technicals

  • by THO
  • 1 week ago
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Stock split means dividing the face value of an equity share into desired small units of the face value of a share. A share split increases the number of shares that are outstanding by issuing more stocks to the existing shareholders. Novice investors should note that a stock split reduces the market price of a company’s stock. However, it does not change the market capitalization of the firm. Most of the time, we observe that the split ratio remains 2:1. However, that is not the case always. The ratio is usually dependent on the stock price. Shares with a high price may split in multiple fractions.

The main reason for the stock split is to invite more participation of retail investors and improve the marketability of the stock. It ensures wider participation in a company’s shareholding and thus increases liquidity in the stock. If you own a share that splits, then you may not make money immediately, but you shouldn’t sell the stock as the split is considered a positive sign. Here we are covering three stocks that have announced stock split.

1. Schaeffler India Ltd (NS:)

Schaeffler India manufactures high-precision components and systems for the drive train and chassis applications as well as rolling and plain bearing solutions for a large number of industrial applications. In a BSE filing on October 12, the company declared that it will consider a sub-division of equity shares. In this connection, SIL’s board is scheduled to meet on October 28 to consider the sub-division and approve the unaudited financial results for the quarter ended September 30, 2021.

The stock delivered a return of 122.9% in a year, 70.4% return year-to-date, 50.7% in six months, 8% in a month, 8.2% in five days, and 2.8% on October 12. Based on major technical parameters such as Relative Strength Index (or RSI), Moving Average Convergence Divergence (or MACD) and 20-day/30-day/50-day/100-day/200-day Exponential Moving Average (or EMA), Schaeffler India has a ‘buy recommendation. Most notably, FIIs/FPIs and mutual funds have marginally increased their holding in Schaeffler India in September 2021 quarter.

2. Indian Railway Catering and Tourism Corporation Ltd

Indian Railway Catering and Tourism Corporation Ltd (or IRCTC (NS:)) provide services like ticketing, catering, and tourism services for the Indian Railways. The government of India owns 67.4% of IRCTC at the end of the September 2021 quarter. Since its listing in October 2019, the IRCTC stock has been a darling of retail investors. In August 2021, IRCTC announced a stock split of one equity share into five equity shares to attract the larger participation of retail investors. The split date of the stock is October 28, 2021.

IRCTC
So far, the scrip has delivered phenomenal returns since its listing. From its IPO price of Rs 320, the share delivered a whopping 1,545% closing at Rs 4,946.95 on October 12. The stock gained 269.7% in a year, 242.4% year-to-date, 207.6% in six months, 33.3% in a month, 7.9% in five days, and 2.7% on October 12. IRCTC has a ‘buy’ recommendation based on key technical parameters such as MACD, Momentum, and 10-day/20-day/30-day/50-day/100-day/200-day EMA.

3. Steel Strips Wheels Ltd (NS:)

Steel Strips Wheels Ltd manufactures single-piece steel wheel rims for scooters, passenger cars, utility vehicles, and tractors. On September 3, the company’s board approved a stock split in the ratio of two equity shares for every one existing equity share held (1:2 ratio). The company will decide the record date for a stock split in due course of time. The shareholders’ consented to the split at the Annual General Meeting on October 4.
SSWL
The stock delivered a return of 280.2% in a year, 246.4% year-to-date, and 164.8% in six months. On September 27, HDFC (NS:) Securities issued a target price of Rs 2,056 for six months on Steel Strips. The share closed at Rs 1,805 on October 12 and trades at a 7.8% discount to its 52-week high. Notably, FIIs/FPIs have marginally increased their holding in September 2021 quarter. The company’s stock has a ‘buy’ suggestion based on key technical indicators such as RSI, MACD, and 10-day/20-day/30-day/50-day/100-day/200-day EMA.



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