Kotak Mahindra Bank’s Board has approved a stock split on its 40th Foundation Day, dividing each share with a face value of ₹5 into five shares with a face value of ₹1 each. This decision aims to enhance liquidity and make the shares more affordable for retail investors. The split is subject to regulatory approvals and is expected to complete within two months of receiving necessary clearances.
Stock Split Announcement
Kotak Mahindra Bank announced that its Board of Directors has approved a sub-division (stock split) of its equity shares during a meeting held on the occasion of the Bank’s 40th Foundation Day. The decision is subject to regulatory and statutory approvals.
Details of the Split
The approved sub-division involves splitting each existing equity share of the Bank, which currently has a face value of ₹5, into five equity shares, each with a face value of ₹1. This move is intended to enhance liquidity and make Kotak’s equity shares more accessible to retail investors, encouraging wider market participation.
Rationale Behind the Decision
The stock split aims to create long-term value for shareholders by making the Bank’s equity shares more affordable and liquid. The Board decided to sub-divide the existing equity shares to facilitate a smaller denomination of ₹1 per share, aligning with the goal of wider investor inclusivity.
Capital Clause Amendment
Consequently, the Board has also approved an amendment to the Capital Clause of the Memorandum of Association of the Bank to reflect the revised share structure following the stock split.
Approval and Timeline
The approvals are contingent upon consent from the Bank’s members, the Reserve Bank of India (RBI), and other applicable regulatory authorities. The process is expected to be completed within two months from receiving all necessary clearances.
Source: BSE
