Have shares of Bajaj crashed 90% ?
Bajaj Finance Stock Crash? Here’s the Truth Behind the 90% Price Drop
Dated: 16.06.2025
Investors of NIFTY heavyweight Bajaj Finance were taken by surprise this morning when they saw a sharp 90% drop in the value of their holdings. At first glance, this appeared to be a massive crash. However, this drop is not due to poor fundamentals or market panic. Rather, it’s a result of a stock split and bonus issue implemented by the company.
Let’s break it down in simple terms to understand what actually happened and why there’s no reason to panic.
Many investors were confused about the sudden Bajaj Finance Stock Crash after the 90% dip appeared on June 16, 2025.
What Triggered the 90% Drop in Bajaj Finance Shares?
Bajaj Finance recently announced two key corporate actions:
- A 1:2 stock split
- A 4:1 bonus share issuance
These actions came into effect simultaneously, which changed the shareholding structure, number of outstanding shares, and per-share price.
Understanding the Corporate Actions:
Stock Split (1:2 Ratio)
This means that every share with a face value of ₹2 was split into two shares with a face value of ₹1 each. The total investment value remains unchanged, but shareholders now own double the number of shares.
Bonus Issue (4:1 Ratio)
After the split, for every 1 share held, 4 additional shares were issued. So, if an investor had 1 share originally, it first became 2 after the split. Then, for each of those 2 shares, 4 new shares were added – making it 10 shares in total.
What Does This Mean for Investors?
Here’s what actually changed:
Increased Number of Shares
The total number of shares held by investors increased 10-fold. This is great for liquidity and participation, especially for retail investors who couldn’t afford the stock at higher prices.
Adjusted Share Price
The apparent “90% crash” is a technical adjustment. Since the number of shares increased 10 times, the price per share automatically decreased in proportion. For example, if the share was ₹7,000 before the actions, it would now reflect around ₹700 post-adjustment. The total value of the investment remains the same.
Better Market Accessibility
With lower per-share prices, more retail investors can afford to invest. This enhances liquidity and may positively impact trading volume and stock visibility.
Why Do Companies Do This?
Corporate actions like splits and bonuses are common among financially strong companies. Here’s why companies like Bajaj Finance take this step:
Capital Structure Realignment
It’s a way to optimize the company’s capital structure and align with growth strategy.
Shareholder Reward
This is often seen as a reward for existing shareholders. Bonus shares and splits signal the company’s confidence in its business outlook.
Retail Investor Attraction
With a lower price tag, shares become more attractive to small investors. It increases inclusivity and builds retail investor trust.
Market Sentiment Boost
Such moves are usually welcomed positively by the market. It sends a message that the company is healthy, profitable, and growth-oriented.
Should You Be Worried?
Absolutely not. While the price drop may have caused confusion or even panic among those unaware of the corporate action, the fundamentals of Bajaj Finance remain strong.
In fact, these steps are indicative of a company’s maturity, shareholder focus, and growth confidence. If you saw your investment value drop, check the number of shares – it would’ve increased by 10x.
While headlines scream about a ‘Bajaj Finance Stock Crash’, the reality is simply a technical adjustment…
Investor Precautions:
If you’re an investor or planning to invest in stocks, here are a few things to keep in mind:
- Always verify news before reacting. Many demat platforms adjust prices before updating the share count.
- Understand corporate actions. Look for stock split, bonus, dividend announcements in the company’s filings.
- Use reliable financial platforms like NSE, BSE, or SEBI for authentic updates.
- Don’t base decisions on price alone. Look at fundamentals and long-term prospects.
Read More on Stock Splits & Bonus Shares:
https://www.investopedia.com/terms/s/stocksplit.asp
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Disclaimer:
This article is for informational purposes only. It summarizes updates from publicly available sources and AI-generated insights. We are not SEBI-registered investment advisors, and this content does not constitute investment advice.
Readers are advised to consult a professional financial advisor before making any investment decisions. We are not liable for any financial loss incurred based on this article.
If you’re holding or tracking Bajaj Finance stock, don’t panic! The drop in price is a reflection of stock split and bonus benefits. Your portfolio is likely intact or even better positioned for the long term with more shares, increased liquidity, and a stronger company outlook.
Understanding corporate actions can help you stay calm during events like the Bajaj Finance Stock Crash.