A-1 Ltd Sets Record Date for 3:1 Bonus & 10:1 Stock Split

Introduction

A-1 Ltd, a prominent player in the chemical trading and logistics sector, has announced significant corporate actions aimed at restructuring its share capital. The company's Board of Directors has approved a 3:1 bonus issue and a 1:10 stock split, setting Monday, December 22, 2025, as the record date to determine shareholder eligibility. This move comes as the company undertakes a strategic pivot towards the high-growth electric vehicle (EV) market, and has been met with strong investor enthusiasm, with the stock hitting its upper circuit limit in recent trading sessions.

Decoding the Corporate Actions

Corporate actions like bonus issues and stock splits are tools companies use to increase share liquidity and make them more accessible to retail investors. A-1 Ltd is employing both simultaneously, which will dramatically increase the number of its shares trading in the market.

The 1:10 Stock Split: This action involves subdividing each existing equity share. One equity share with a face value of ₹10 will be split into ten equity shares, each with a new face value of ₹1. The primary goal is to lower the per-share trading price, making it more affordable for a broader base of investors.

The 3:1 Bonus Issue: In addition to the split, the company will issue bonus shares. For every one equity share held on the record date, shareholders will receive three additional free shares. This is a way of capitalizing the company's accumulated profits and reserves, signaling management's confidence in its financial health and future prospects.

The Combined Impact on Shareholders

The dual corporate actions will have a multiplicative effect on the number of shares held by an investor. First, for every one share held, an investor will receive three bonus shares, taking their total to four shares. Then, each of these four shares will be split into ten. Consequently, for every single share held before the record date, an investor will own 40 shares post-actions.

For example, an investor holding 100 shares of A-1 Ltd will first receive 300 bonus shares, bringing their total to 400 shares. After the 1:10 stock split, these 400 shares will become 4,000 shares.

Price Adjustment and Investment Value

It is crucial for investors to understand that while the number of shares increases significantly, the total value of their investment remains unchanged at the moment of the corporate action. The stock price will adjust downwards in proportion to the increase in the number of shares. For instance, if the stock closes at ₹2,000 on the day before the ex-date, the theoretical adjusted price would be ₹50 per share (₹2,000 / 40). This price reduction is intended to make the stock more attractive to retail investors, potentially boosting trading volumes.

Strategic Rationale: A Pivot to Electric Vehicles

The timing of these corporate actions is closely linked to A-1 Ltd's strategic transformation. The company is actively expanding into the clean mobility and EV sector through its subsidiary, A-1 Sureja Industries. A-1 Ltd recently increased its stake in this subsidiary to 51%, signaling a firm commitment to this new vertical. The company plans to invest in EV component manufacturing, research and development in battery technology, and building smart charging infrastructure. To support this capital-intensive expansion, the board has also proposed increasing the company's authorized share capital from ₹20 crore to ₹46 crore, creating room for future fundraising.

Recent Performance and Market Reaction

A-1 Ltd's stock has delivered multi-bagger returns, reflecting strong market confidence. The share price has surged approximately 475% year-to-date in 2025 and an astonishing 3,756% over the past five years. The announcement of the bonus and split, coupled with its EV plans, has pushed the stock to hit its 5% upper circuit limit for five consecutive days, closing at a new 52-week high of ₹2,317.25 recently. This performance highlights the market's positive reception of the company's strategic direction and shareholder-friendly moves.

Conclusion

A-1 Ltd's decision to issue bonus shares and split its stock is a calculated move to enhance shareholder value and prepare for its next phase of growth. By increasing liquidity, the company aims to attract a wider investor base to support its ambitious pivot into the electric vehicle industry. While the immediate effect is a mechanical adjustment in share count and price, the long-term value for investors will be determined by the successful execution of its EV strategy. Shareholders will be voting on these proposals via a postal ballot, with the results expected in late December 2025.