Multibagger IPO: Stock split effect! KPR Mill share price rally turns ₹6625 into ₹2.32 lakh in 18 years | Stock Market News

Multibagger IPO: As Rome was not built in a day, a stock market investor can’t become rich overnight. It is often said that money is not in buying and selling stocks but in waiting. This rule also applies to an IPO (Initial Public Offering) investor. If an IPO investor is convinced about a company’s business prospects, then irrespective of size, one should stick with one’s conviction and hold the stock as long as possible. A stock split is a corporate action that increases the number of a company’s outstanding shares by dividing each share and reducing its price. This does not affect the company’s market value but makes the stock more affordable for smaller investors.

An IPO investor is advised to keep the scrip as long as possible to create wealth on the premium that promoters of the company have offered to its investors in the primary market. So, by holding a stock for a long term after share allocation, an allottee enjoys the benefit of wealth creation. By having a stock for the long term, they want the benefit of various other rewards like dividends, bonus shares, stock splits, buybacks of shares, etc., which helps an IPO allottee in wealth compounding.

KPR Mill share price history

To truly grasp the potential for wealth creation through long-term investment, let’s delve into the inspiring KPR Mill share price journey. KPR Mill shares were offered at a price band of ₹225 to ₹265 per equity share, and the lot size of the public issue was 25 company shares. This means one lot of this multibagger IPO was ₹6,625 ( ₹25 x 265). The public issue was offered in August 2007 and listed on the BSE and the NSE on 28 August 2007. The public issuer had a weak listing on the Indian bourses as it listed on the BSE and the NSE at ₹201.20 and ₹175 per share, respectively. After the discounted listing, KPR Mill’s share price remained under selling pressure, ending at around the ₹169 per share mark on the share listing date.

Despite the weak listing, if a share allottee had remained invested in KPR Mill shares until date, following its conviction developed after scanning the company’s financials, its ₹6625 (the minimum amount required to apply for the IPO) would have turned into ₹2.32 lakh today. This wealth creation could have become possible due to the two stock splits that KPR Mill shares underwent after the share listing.

KPR Mill stock split history

According to the stock split history available on the BSE website, KPR Mill shares traded ex-date for a stock split in a 1:2 ratio for the first time post-listing on 29th September 2016. Later, it again traded ex-date for a stock split in a 1:5 ratio on 24th September 2021. So, if a share allottee had remained invested in the scrip to date despite the weak listing of KPR Mill shares, its shareholding in the company would have surged 10 times to 250 shares (25 x 2 x 5).

₹6625 turns into ₹2.32 lakh

KPR Mill share price currently quotes ₹928 apiece on the NSE (11:00 AM on 31 January 2025). If an allottee had remained invested in KPR Mill shares despite discounted listing, the absolute value of ₹6625 ( ₹265 x 25) would have turned to ₹2.32 lakh ( ₹928 x 250).

So, an allottee of ₹6,625 would have turned to ₹2.32 lakh in 18 years if the allottee had remained invested in KPR Mills despite a discounted listing on the stock listing date.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.