₹1 lakh turns to ₹36 lakh in 14 years as IT stock gave bonus shares 3 times
A stock market investor not just earn from stock price appreciation. There are various other means that help its money grow. Dividend payment, buyback of shares, bonus shares, etc. are some important announcements that a long term investor eagerly await from the listed companies belonging to its stock portfolio. Wipro shares are one such stock. The IT major has given bonus shares to its long term investor thrice in last 14 years turning ₹1 lakh to more than ₹36 lakh in this time horizon.
Wipro share price history
In March 2009, Wipro shares were available at around ₹50 whereas Wipro share price today is ₹412.35 apiece. However, for a long term investor, the return is much more than its stock price appreciation. In last 14 years, Wipro Ltd has announced bonus shares on three occasions — June 2010, June 2017 and March 2019. In June 2010, Wipro Ltd announced bonus share issue in 2:3 ratio. In June 2017, the IT company announced bonus shares in the ratio of 1:1 whereas in March 2019, it announced issuance of bonus shares in 1:3 ratio.
Bonus share impact
If a long term investor had invested ₹1 lakh in this IT stock 14 years ago when the market bottomed out post-slowdown sell off, it would have got one Wipro share at ₹50 apiece in March 2009. This means around 20,000 Wipro shares could have been bought paying ₹1 lakh in March 2009. This 20,000 Wipro shares would have turned to 3,332 Wipro shares after issuance of bonus shares in 2:3 ratio. Later on, these 3,332 Wipro shares would have turned to 6,664 Wipro shares in June 2017 after issuance of bonus shares in 1:1 ratio. In March 2019, Wipro again announced bonus shares in 1:3 ratio. So, 6,664 Wipro shares would have further turned to 8,885 shares. That means, shareholding of an investor investing ₹1 lakh in Wipro in March 2009 would have been 8,885.
₹1 lakh turns to ₹36 lakh
As Wipro share price today is ₹412.35 apiece, one’s ₹1 lakh would have turned to ₹36.63 lakh today ( ₹412.35 x 8,885) in last 14 years after three bonus shares declared by the IT major.
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Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.