BSE Ltd. - Proxy play for Indian Capital Markets?

If there is one stock which is above firing up like a rocket from last 10 days , It is BSE Ltd.

5 day performance

10 days performance

In the past one week, the market price of BSE has rallied 35 per cent after the company fixed March 22, 2022, as the record date for the purpose of determining the names of shareholders who shall be entitled for allotment of bonus equity shares in the ratio of 2 new fully paid-up equity shares of Rs 2 each for every 1 fully paid-up equity share held by the shareholders of the company.

Excerpt from the article below :point_down:

It is incredible to see the stock zooming up by 40% for bonus specific news. Looks like this is just one of the triggers and market has kind of realised the potential of this stock in the long run.

What do you think about this move? Is it based on short term news flow or is market realising the potential of BSE ltd ?

I saw similar moves or even bigger moves in IRCTC & Alkylamines, two of which I remember because I was holding them.

IMO as a trader, shorting BSE in a day or two is what I’d do with a defined tight stop. It’s moving parabolic :dizzy_face:

The record date is 22nd march and not sure if this rise is due to bonus stripping to avoid tax. I read in one of the newspapers that as tax laws have changed on bonus stripping, many companies might come out with bonus issues before the financial year closes.

Disc: Not sure, just conjecture…

So, logically can one expect the following, correct?

a. a minor drop (how much%?) on 23rd March (i.e. day after the record date)?
b. a major drop (60%?) immediately after the day the bonus shares are issued?

You mean on the day one expects the stock to drop,
if the stock is trading at around Rs.3000,

  • one can place an intraday/MIS sell at market price,
    with a slightly-higher than market-price stop-loss (eg.3100).
  • place an intraday/MIS buy order at a lower limit price
    (but, higher than the lower circuit limit).

Something like the above, someday soon, right?
(with the numbers adjusted for that day’s stock-price and one’s risk appetite)