BSE Share Price Nosedives 65% on NSE: Here's the Real Reason Behind The Massive Crash

On Friday, May 23, BSE shares appeared to plummet by over 65% on the National Stock Exchange (NSE), causing confusion among investors. However, this sharp decline was not due to any negative business developments but was a result of the stock trading ex-bonus following the company's 2:1 bonus issue.

BSE Bonus Issue Details

BSE had announced a 2:1 bonus share issue, meaning shareholders would receive two additional shares for every one share held, with a face value of Rs.2 each. The record date for determining eligibility for this bonus issue was set for Friday, May 23rd . Consequently, the stock turned ex-bonus on this date, leading to an adjustment in its trading price to reflect the increased number of shares in circulation.

Price Adjustment Explained

Before the ex-bonus date, BSE shares closed at ₹7,015. On May 22, the stock opened at Rs. 2,358, aligning with the 2:1 bonus ratio. This adjustment is a standard procedure in the stock market to account for the issuance of bonus shares and does not indicate a loss in shareholder value.

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The apparent 65% drop in BSE's share price led to confusion among investors, primarily because some trading platforms did not immediately reflect the adjusted price post-bonus issue. This discrepancy resulted in misleading visuals of a steep decline, even though the actual value of investors' holdings remained unchanged.

BSE Shares Post-Adjustment Performance

Despite the initial confusion, BSE shares showed resilience. After the price adjustment, the stock rose over 2% intraday to reach Rs. 2,389. The company's market capitalisation stood at approximately Rs 96,000 crore, and the stock remained about 6% below its adjusted 52-week high of Rs 2,529.33, achieved earlier in the week.

BSE recently announced robust Q4 FY25 earnings, reporting a 364% year-on-year rise in net profit. Net profit for the quarter surged to ₹493 crore, compared to ₹106 crore in Q4 FY24. Revenue from operations also jumped by 75% YoY, increasing from ₹484 crore to ₹847 crore.

About BSE Ltd

BSE Limited, formerly known as the Bombay Stock Exchange, is Asia's oldest stock exchange, established in 1875. Headquartered in Mumbai, BSE is a cornerstone of India's financial markets, providing a transparent and efficient platform for trading in equities, derivatives, currencies, mutual funds, and bonds. It is home to the iconic Sensex, India's first and most widely tracked stock market index. It also supports SMEs and startups through its dedicated SME and innovation platforms.