3:1 bonus shares: Multibagger SME IPO gives 1900% return in two years
Multibagger bonus shares: A long term investor not just enjoy the benefit of rise in stock price only. They get benefit of the various awards that a listed company declares time to time from its capital reserves. These awards can be in the form of interim or final dividend, bonus shares, stock split, buyback of shares, etc. These awards may look small at the time of declaration but it turns out a big catalyst to enhance long term investors’ return over the period of time. EKI Energy Services shares are a glaring example of it. This SME stock is one of the multibagger stocks and IPOs that Indian stock market has produced in last few years.
This multibagger SME stock was listed on BSE SME exchange in April 2023 and in last two years, it has risen to the tune of 1,150 per cent. However, if we consider the 3:1 bonus shares that the SME stock declared in July 2022, net return given by this multibagger IPO in last two years to its allottees is more than 1,900 per cent in this time.
EKI Energy Services share price history
EKI Energy Services IPO was launched in April 2021 and it was listed on BSE SME exchange 7th April 2021. The public issue was offered at a price band of ₹100 to ₹102 per equity share and lot size of the SME IPO comprised 1200 company shares. If an allottee had remained invested in this SME IPO till date, it would have benefited from the 3:1 bonus shares, means 3 additional bonus shares for every share owned leading to rise in shareholding of the allottee four time. This means, an allottees shareholding in EKI Energy Services would have surged from 1200 to 4800 (1200 x 4).
Impact on investment
As EKI Energy Services share price today is ₹512.75 apiece and one’s shareholding at 4800 shares, absolute value of one’s investment in EKI Energy Services would have surged to ₹24,61,200.
At the time of this multibagger SME IPO launch, a retail investor had to invest ₹1,22,400 ( ₹102 x 1200) to apply for the SME IPO. This means, net investment of an allottee had been ₹1,22,400 and if the allottee had remained invested in this SME IPO till date, the absolute value of one’s investment would have surged to ₹24,61,200, mmore than 1900 per cent in last two years.
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