United Spirits approves stock split in the ratio of 5:1

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Liquor maker United Spirits' share price will trade in 3-digit on exchanges soon.

After market trading hours on Friday, the company announced a stock split. One share with a face value Rs 10 will be split into five shares with a face value of Rs 2 each.

In a release to the BSE, United Spirits said the company's board of directors at a meeting held on April 13, considered and approved the following:

1. Sub-division of 548,000,000 equity shares of face value of Rs. 10/- per equity shares in to 2,740,000,000 of equity shares of face value of Rs. 2/- per equity share subject to approval by the shareholders of the Company by way of special resolution.

2. Sub-division of 120,000,000 7 percent non-cumulative redeemable preference shares of Rs. 100/- each into 1,200,000,000 number of preference shares of Rs. 10/- each and this clause of preference shares shall merge with another clause of 159,200,000 preference shares of the face value of Rs. 10/- each.

This means share price, currently in 4-digit at around Rs 3,480, will start trading in 3-digit on ex-date.

Stock split generally is used to increase trading volume of shares, so that participation will increase.

United Spirits shares closed 1.27 percent up at Rs 3478.65 on the BSE today.