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28 Nov 2024, 09:00 PM
Adjustment of F&O contracts of WIPRO on account of bonus.
As per the circular, effective from December 3, 2024, the WIPRO 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 WIPRO, 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 3000.
For example: Assume you are holding a position in WIPRO OCT FUT, and on pre-ex-date (December 2, 2024), futures close at 580, on ex-date, the price will be adjusted to 290 (Price on pre-ex-date: 580 / Adjustment Factor: 2), while the lot size will be adjusted to 3000 (Current lot size: 1500 * Adjustment Factor: 2).
Adjustment for Options Contracts:
Strike Price: The adjusted strike price will be determined by dividing the old strike price by the adjustment factor.
Lot Size: The adjusted lot size will be determined by multiplying the old market lot by the adjustment factor. The revised lot size would be 3000.
For example: Assume you hold a position in WIPRO 550 CE and the current lot size is 1500. On ex-date, the 550 CE will be adjusted to 275 (Strike Price: 550 / Adjustment Factor 2), and the lot size will be adjusted to 3000 (Current Lot Size: 1500 * Adjustment Factor: 2).
Also, if you hold equity shares of WIPRO in your demat account as of December 3, 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.