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12 Jun 2024, 08:54 PM
Adjustment of F&O contracts of BPCL on account of bonus.
As per the circular (1) (2), effective from June 21, 2024, the BPCL F&O contracts will be revised based on the bonus adjustment factor.
Calculation of the adjustment factor: Adjustment factor for Bonus issue of A:B is defined as (A+B)/B. In the case of BPCL, the adjustment factor is (1+1)/1 = 2, since the bonus issue ratio is 1:1.
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 1800.
For example: Assume you are holding a position in BPCL Futures, and on pre-ex-date (June 20, 2024), futures close at 400, on ex-date the price will be adjusted to 200 (Price on pre-ex-date: 400 / Adjustment Factor: 2), while the lot size will be adjusted to 1800 (Current lot size: 900 * 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 1800.
For example: Assume you hold a position in BPCL 350 CE and the current lot size is 900. On ex-date, the 350 CE will be adjusted to 175 (Strike Price: 350 / Adjustment Factor 2), and the lot size will be adjusted to 1800 (Current Lot Size: 900 * Adjustment Factor: 2).
Also, if you hold equity shares of BPCL in your demat account as of June 21, 2024, you will be entitled to receive the bonus shares, which will be credited to your demat account usually within 15 – 20 days from the record date.