If MRF's share is split, then the reach will increase, know from the expert how it will be beneficial

Stock split also has a big role in MRF's shares becoming Lakhtakia. IIFL Securities Vice President Anuj Gupta says that the company has not split the stock yet.

Tire maker MRF created history in the stock market on Tuesday. In the early trading of Tuesday, the price of one share of this company crossed Rs 1 lakh. Now the question is what is so special about the stock of this company that its price has become so high. At the same time, MRF has not even split the shares yet, isn't this also a big reason to become Lakhtakia.

IIFL Securities Vice President Anuj Gupta told TV9 Hindi that if this share split happens, then its scope will increase and its reach will reach more and more people, which will also benefit the company. Now let us know whether this is the only reason for share split or there are other reasons for its rise.

Reason No. 1 – Investors' Confidence

Actually the company has given tremendous returns in the last two years. In March 2020, the company's stock had come down to a low of Rs 55,000. But since then the stock of the company has gained 86 per cent from the low level. In fact, strong returns have increased the confidence of investors in the company. The company's stock reached Rs 94500 in December 2022 on the basis of strong returns.

Reason No. 2 – Stock Split

Stock split also has a big role in MRF's shares becoming Lakhtakia. Anuj Gupta of IIFL Securities says that the company has not split the stock yet. This is a big reason for the price of the company's shares crossing Rs 1 lakh. Anuj Gupta says that if the company splits the stock, then common investors will also be able to buy it. With this, the market cap of the company will also increase and the reach of the company will be stronger in the market. Actually, when the share price of any company becomes beyond the reach of the common man, then the company breaks its price. Suppose the price of any one share is Rs 1000, then when the company splits the shares, it reduces the share and increases the quality. If someone has 10 shares of the company at the rate of Rs.1000 and the company splits the share and its price is Rs.500. So the number of shares of the company will increase with that investor, although the total value will remain the same.

Reason No. 3 Strong Fundamentals

Investors' faith in MRF is also due to the strong fundamentals of the company. Strong Goodwill of more than 50 years strengthens the fundamentals of the company and continues to win the confidence of investors. MRF is known as a strong brand in India. Actually MRF tires are a name to be trusted in themselves. Which the company has earned over a long history.

Reason No. 4 – Strong Growth

Starting from a small trading business of rubber and leather goods, the company has become a big name in the tire industry today. On the growth front, the company has earned high returns and has also made investors rich. Talking about ROEC, the company has kept it above 30% for many years in a row. At the same time, the FCF margin has also remained above 20.