Adani Power Shares: Demystifying the 74% Price Adjustment After Stock Split

Adani Power Shares: Demystifying the 74% Price Adjustment After Stock Split

Today, Adani Power Ltd, a major player in the thermal power generation sector, saw its share price significantly adjust, experiencing a 74 percent drop during the trading session. While such a sharp decline might initially raise concerns among investors, it's crucial to understand that this movement was a pre-planned and technical adjustment. The reason behind this considerable price change is the record date for the company's 1:5 stock split. This corporate action means that eligible shareholders received additional shares, which consequently led to a proportional reduction in the per-share market price. Understanding the Mechanics of a Stock Split A stock split is a corporate decision where a company increases the number of its outstanding shares by dividing each existing share into multiple new shares. In the case of Adani Power, one existing share with a face value of ₹10 was effectively divided into five new shares, each now holding a face value of ₹2. The company's boa…