1:5 Stock Split: Realty Stock Rallies For 5-Days In Row Before Ex-Split On November 16; Gains 14%

Residential projects company, Atal Realtech has rallied by five consecutive sessions, gaining by over 14% on BSE. The robust rally comes ahead of the realty stock's ex-split on November 16. The stock will be sub-divided in the ratio of 1:5. It currently trades a little over Rs 75 per share.

Ahead of the ex-split day, Atal Realtech shares ended at Rs 76.11 apiece, up by nearly 5% on BSE. The stock has been in green since November 9th.

In 5 consecutive trading sessions, the stock has gained by at least 14.4% on the BSE.

As per the regulatory filing, the company has declared a stock split in the ratio of 1:5. This means that 1 existing equity share having a face value of Rs 10 each, will be subdivided into five equity shares having a face value of Rs 2 each. The stock will turn ex-split on Thursday which is also the record date to determine eligible shareholders for the stock split benefits.

In Q2FY24, the company's PAT nearly doubled to Rs 34.87 lakh as against Rs 17.72 lakh. While revenue from operations came in at Rs 553.92 lakh in Q2FY24 versus Rs 699.29 crore in Q2FY23.

Atal Realtech Limited provides integrated contracting and sub-contracting services for civil and industrial construction, engineering and complete infrastructure project management. The company was incorporated in the year 2012.

It also provides integrated services for governmental projects such as Supply and Drainage Projects, Road and bridge projects, Major and Minor Irrigation Projects and civil construction projects like Sports Stadiums (Indoor and Outdoor), Multi-purpose Hall, Commercial structures, Industrial structures, Hospitals, Cold Storages, Educational Institutions, Mass-Housing projects.

Typically, listed companies declare a stock split of already owned shares into much smaller shares. This is done to improve liquidity by breaking the shares into smaller sizes. The face value of the shares reduces in proportion to the split ratio, however, there is no impact on the company's share capital and reserves. Although the price value of a stock reduces in a stock split, it the number of shares held rises in the investors' portfolio of that specific stock.