Street signs: Stock split buzz in Maruti counter

According to news reports, India’s largest carmaker Maruti Suzuki could well be mulling a stock split, as the value of its shares is inching towards five-digit mark. A stock split though will not alter the fundamentals of the company but it could provide a liquidity boost. Data, however, suggest that despite the skyrocketing share prices, volumes in the counter have hardly been impacted. In fact, the average daily BSE and NSE combined volumes in Maruti surged to 807,000 shares in December. This is nearly double the average daily volumes for the previous six months.

Bitcoin-beating returns 

Shareholders of micro-cap firm Saraswati Commercial are set to make far higher returns than bitcoin. The company has announced a share buyback programme at a price 70 times higher than the current market price. The Rs 5.8-crore buyback is being done at a price of Rs 978 apeice, while the current share price of Saraswari is only Rs 14. The company’s cash reserves have surged to Rs 115.7 crore, while its market capitalisation is just Rs 1.44 crore. The shares are infrequently traded on the BSE with low volumes. The biggest beneficiary of the buyback will be the promoters, who hold 73.4 per cent stake in the company.

Allotment issues in buybacks
 

Investment bankers are likely to approach market regulator Securities and Exchange Board of India (Sebi) to seek clarity over allotment of shares under the buyback programmes. Bankers say there is confusion over a few thousand-odd shares that are left after the proportionate allotment is made. "We want Sebi to clarify if the odd shares that are left should be randomly allotted or preference should be given to those who tender maximum shares. Currently, we follow an arbitrary process but it will be good if the regulator clarifies," said an investment banker.