Power of Equity
Unbelievable but
it has happened
Just imagine....
- How much can you make in 26 years by
just investing Rs.10,000/- initially in
any of
financial instruments?
Take a wild guess???
Let us look at the real example…
If you have subscribed in 100 shares
of _____ company with a face value of Rs.
100/- in 1980…
- In 1981 company declared 1 : 1 bonus
= you have 200
shares
- In 1985 company declared 1 : 1 bonus
= you have 400
shares
- In 1986 company split the share to Rs.
10 = you have 4,000
shares
- In 1989 company declared 1 : 1 bonus
= you have
8,000 shares
- In 1992 company declared 1 : 1 bonus
= you have
16,000 shares
- In 1995 company declared 1 : 1 bonus
= you have 32,000
shares
- In 1997 company declared 1 : 2 bonus
= you have
96,000 shares
- In 1999 company split the share to Rs.
2 = you have
4,80,000 shares
- In 2004 company declared 1 : 2 bonus
= you have
14,40,000 shares
- In 2005 company declared 1 : 1 bonus
= you have
28,80,000 shares
- In 2010 company declared 3 : 2 bonus
= you have 48,00,000
shares
At the end of 2012 …..........
- You have 48,00,000
shares of the company
Any guess about the company? (Hint : Its
an Indian company)
Any guess about the present valuation?
The result of ‘Power
of Compounding’
Your present valuation is
about
Rs.
190 Cr. +
&
The company is ‘WIPRO’
Other such examples
….....
CIPLA
Investment of Rs.
10,000/- in 1979 will fetch Rs. 95 cr.+
INFOSYS
Investment of Rs.
10,000/- in 1992 will fetch Rs. 150 cr.+
RANBAXY
Investment of Rs.
10,000/- in 1980 will fetch Rs. 19 cr.+
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