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12 Sep 2023, 10:00 PM
Adjustment of F&O contracts of HAL on account of Split
As per the circular(web), effective from September 28th, 2023(ex-date) the HAL F&O contracts will be revised based on the split adjustment factor.
Update: The ex-date has been revised from September 29th, 2023 to September 28th, 2023. Check the updated circular here.
Calculation of the adjustment factor: Adjustment factor for the split issue of A:B is defined as (A/B). In the case of HAL, the adjustment factor is (2/1) = 2 since the split issue ratio is 2:1.
Adjustment for Futures Contracts:
Futures base price: The adjusted futures base price will be arrived at by dividing the settlement price of the future one day before the ex-date by the adjustment factor.
Futures lot size: The adjusted market lot will be arrived at by multiplying the old market lot by the adjustment factor. The revised market lot would be 600.
For example: Assume you are holding a position in HAL Futures, and on pre-ex-date (September 27th, 2023), futures close at 4000, on ex-date the price will be adjusted to 2000 (Price on pre-ex-date: 4000 / Adjustment Factor: 2), while the lot size will be adjusted to 600 (Current lot size: 300 * Adjustment Factor: 2).
Adjustment for Options Contracts:
Strike Price: The adjusted strike price will be arrived at by dividing the old strike price by the adjustment factor.
Lot Size: The adjusted lot size will be arrived at by multiplying the old market lot by the adjustment factor. The revised lot size would be 600.
For example: Assume you hold a position in HAL 3800 CE, the current lot size is 300. On ex-date, the 3800 CE will be adjusted to 1900 (Strike Price: 3800 / Adjustment Factor: 2) and the lot size will be adjusted to 600 (Current Lot Size: 300 * Adjustment Factor: 2).
Also, if you hold equity shares of HAL in your demat account as of September 28th, 2023 (ex-date) you will be entitled to receive the split shares, which will be credited to your demat account usually within a week from the ex-date.