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23 Nov 2024, 10:10 AM
Adjustment of Futures and Options contracts of UPL due to Rights issue
As per the circular (web), effective from November 26, 2024 (ex-date), the UPL F&O contracts will be revised based on the rights adjustment factor.
UPL Limited has decided to issue equity shares on rights basis in the ratio of 1:8, i.e. 1 equity shares for every 8 equity shares held, at an issue price of Rs. 360 per equity share. Further, the company has fixed the ex-date as November 26, 2024, to determine the shareholders who will be eligible to apply for the issue.
Symbol: UPL
Rights ratio: 1:8
Ex-date: November 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 1355.
For example, assume you hold a position in UPL 570 CE, the current lot size is 1300. On ex-date, the 570 CE will be adjusted to 546.92 CE (Strike Price: 570 * Adjustment Factor: 0.959510), and the lot size will be adjusted to 1355 (Current Lot Size: 1300 / Adjustment Factor: 0.959510).
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 1355.
For example, assume you are holding a position in UPL NOV Fut, and on pre-ex-date (November 25, 2024), futures close at 570, on ex-date the price will be adjusted to 546.92 (Price on pre-ex-date: 570 * Adjustment Factor: 0.959510), while the lot size will be adjusted to 1355 (Current lot size: 1300 / Adjustment Factor: 0.959510).
The above changes shall be effective from November 26, 2024.