Yes, and the adjustment is automatic. When bonus shares are issued, the stock price drops proportionally on the ex-bonus date to account for the increased number of shares in circulation.
If a stock is trading at ₹500 and the company announces a 1:1 bonus, the price adjusts to approximately ₹250 on the ex-bonus date. You now hold twice the shares at half the price the total value remains the same on that day. This adjustment is done by the exchange automatically.
Once the price adjusts, it trades freely based on market demand. If the market views the bonus positively as a sign of strong reserves and confidence, the stock may recover and trade higher over time. That depends entirely on market sentiment and the company’s fundamentals.
Stock charts are also adjusted retroactively after a bonus issue so the price history reflects the new share count.
Easy & quick
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