25 May 2026, 08:24 AM

Adjustment of F&O contracts of LICI on account of bonus.

As per the circular, effective from May 29, 2026, the LICI F&O contracts will be revised based on the bonus adjustment factor.

Calculation of the adjustment factor:

The adjustment factor for a bonus issue of A: B is defined as (A+B)/B. For LICI, the adjustment factor is (1+1)/1 = 2 since the bonus issue ratio is 1:1.

Adjustment for Options Contracts:

Strike Price: The adjusted strike price is calculated by dividing the old strike price by the adjustment factor.

Lot Size: The adjusted lot size is arrived at by multiplying the old market lot by the adjustment factor. The revised lot size would be 1400.

For example:

Assume you hold a position in LICI JUN 820 CE. The current lot size is 700. On ex-date, the 820 CE will be adjusted to 410 (Strike Price 820 / Adjustment Factor 2), and the lot size will be adjusted to 1400 (Current Lot Size: 700 * Adjustment Factor 2).

If the option premium is ₹31 on pre-ex-date, the adjusted premium on ex-date would be ₹15.5 (Option Premium ₹31 / Adjustment Factor 2).

Adjustment for Futures Contracts:

Futures base price: The adjusted futures base price is 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 1400.

For example:

Assume you are holding a position in LICI JUN FUT and on pre-ex-date (May 27, 2026), futures close at 831, on ex-date, the price will be adjusted to 415.5 (Price on pre-ex-date: 831 / Adjustment Factor: 2)

While the lot size will be adjusted to 1400 (Current lot size: 700 * Adjustment Factor: 2).

You can learn more about this here.