The stock turned ex-split after BEML’s recently announced 1:2 stock split, which reduced the face value of each share from Rs 10 to Rs 5.
The apparent plunge simply reflects a price adjustment for the increased number of shares in circulation. Investors holding BEML shares before the ex-date now own twice as many shares at half the face value, keeping their overall investment unchanged.
What’s really happening?
Suppose an investor held 1 share worth Rs 2,000 before the stock split. Post the 1:2 split, they now hold 2 shares worth Rs 1,000 each. While the per-share price is halved, the overall portfolio value remains the same. This kind of price movement is a mathematical adjustment, not a sign of deteriorating company fundamentals.
Why stock splits?
Stock splits are typically implemented to enhance liquidity and make shares more affordable for a wider base of investors, particularly in the retail segment. By lowering the per-share price without altering the company’s market capitalization, such corporate actions can improve participation and trading volumes.BEML had earlier notified the exchanges of the corporate action, with the record date set as November 3, 2025. The split-adjusted prices will reflect in the trading session that follows.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)