25 Jul 2024, 06:00 PM
Adjustment of Futures and Options contracts of TATACONSUM due to Rights issue
As per the circular(web), effective from July 26, 2024(ex-date), the TATACONSUM F&O contracts will be revised based on the rights adjustment factor.
TATA CONSUMER PRODUCTS LIMITED(TATACONSUM) has decided to issue equity shares on rights basis in the ratio of 01:26, i.e. 1 Equity shares for every 26 Equity shares held, at an issue price of Rs. 818 per equity share. Further, the company has fixed ex-date as July 26, 2024 for the purpose of determining the shareholders who will be eligible to apply for the Issue.
Symbol: TATACONSUM
Rights ratio: 01:26
Ex-date: July 26, 2024
Adjustments for Options Contracts:
Strike Price: The adjusted strike price shall be arrived at by multiplying the old strike price by the adjustment factor.
Market Lot: The adjusted market lot shall be arrived at by dividing the old market lot by the adjustment factor. The revised market lot would be 455.
For example, assume you hold a position in TATACONSUM 1240 CE, the current lot size is 450. On ex-date, the 1240 CE will be adjusted to 1224.77 CE(Strike Price: 1240 * Adjustment Factor: 0.987724), and the lot size will be adjusted to 455 (Current Lot Size: 450 / Adjustment Factor: 0.987724).
Adjustments for Futures Contracts:
Futures price: The adjusted Futures base price shall be arrived at by multiplying the old Futures base price by the adjustment factor.
Market Lot: The adjusted market lot shall be arrived at by dividing the old market lot by the adjustment factor. The revised market lot would be 455.
For example, assume you are holding a position in TATACONSUM Futures, and on pre-ex-date (July 25, 2024), futures close at 1230, on ex-date the price will be adjusted to 1214.9 (Price on pre-ex-date: 1230 * Adjustment Factor: 0.987724), while the lot size will be adjusted to 455 (Current lot size: 450 / Adjustment Factor: 0.987724).
The above changes shall be effective from July 26, 2024.