Multibagger Stock: A long-term stock investor not only benefits from an increase in the share price of his portfolio stock. There are many other sources of income for the shareholders that help the stock to grow its money even when it is not rising. Declaration of interim dividend, bonus shares and buyback of shares are additional tools that help long-term stock investors grow their money. However, if the stock rises with these instruments, it becomes an icing on the cake for stock investors. Shares of Titan Company is one such stock which has given great returns to its shareholders and has also announced Bonus Shares and Stock Split. Titan shares are one of the multibagger stocks that Share Market given in the last few years.
Titan Share Price History
titan share price climbed from from 3 2,535 each level, logging about 845 times over the past 20 years. However, its long-term investors haven’t just made a profit from the rise in the stock’s price. The company has also announced 10:1 stock split and 1:1 bonus share during this period. However, an investor does not earn from a stock split, but due to a stock split, his number of shares increases and his input cost is reduced. As Tata Group stock announced a 10:1 stock split in June 2011, the input costs of shareholders who had bought Titan shares 20 years earlier in August 2002 reduced their input costs to 10 percent of their actual cost. .
The Tata group company announced 1:1 bonus shares to its shareholders in June 2011. Therefore, due to the issue of bonus shares, the cost price of shareholders who bought Titan shares 20 years ago declined further by 50 percent. Since the stock split had already reduced their input cost by 10 per cent of the actual cost. The bonus share issue reduced their cost price to 5 percent of their actual purchase level. As soon as he bought a share of Titan 3 each, due to the 10:1 stock split and the announcement of 1:1 bonus shares, reduced the actual cost of a share for such investors 0.15 each.
Therefore, the payout for long-term investors who bought shares of Titan Company 20 years ago 3 per share, their purchase cost reduced 0.15 per share due to the 10:1 stock split and 1:1 bonus shares announced in June 2011. For such long-term investors, Titan share price has gone up. from 0.15 2,535 each level, recorded 16,900 times over the past two decades.
impact on investment
If an investor had invested Twenty years ago Titan Company’s shares paid 1 lakh 3 pieces, its 1 lakh would have increased 16,900 times ( 2535/ 0.15) turning it from 1 lakh 169 crore in the last two decades.
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