100 Infosys-shares, bought in 1993, would've made you a crorepati
What's the story
Infosys' share opened at a price of Rs. 1,253 today. People, who bought 100 shares of the IT consulting company at the issue price of just Rs. 95/share in 1993 and held it for the next 25 years, are crorepatis. Adjusting for bonus shares declared by the company over the years, those 100 shares have grown to 17,064 now. Here are the details.
Bonus Issue
Infosys declared 7 bonus issues in 25yrs: Break-up here
In its long journey, Infosys has been rather generous. It declared three 1:1 bonus issues from 1994-1999; as a result, the number of shares increased from 100 to 800. Then, it split the Face Value of its share from Rs. 10 to Rs. 5 in 1999, that doubled them to 1,600. Further, 3:1 bonus issue in 2004 increased the number of shares to 2,133. And, after 1:1 bonus issues from 2006-2015, they increased to 17,064.
Number Game
Let's understand the journey to becoming crorepati in numbers
Let's understand how 100 Infosys shares bought in 1993 for less than Rs. 10,000 are now worth over Rs. 2cr. Number of shares bought in 1993: 100 Numbers of shares held by those investors today after the share split and bonus issues: 17,064 Opening price of share on June 14, 2018: Rs. 1,253 (NSE) Total worth of those 100 shares today: 17,064*1,253= Rs. 2,13,81,192cr
Current View
Should you still hold or buy Infosys share?
Infosys' share has gained over 20% so far this year and nearly 32% over the last one year. The company posted a strong net profit of Rs. 3,157 crore for Q4 FY18 and the management aims for a 6-8% growth in FY19 revenues, which corresponds with the industry growth. Thus, investors can maintain their holding in Infosys for a long term.
Information
Disclaimer on holding advice for Infosys share
We anticipate that the Infosys share will generate good returns for investors maintaining a long-term view on the stock, considering the company's profile, its financials and current national and economic sentiments. However, the readers are advised to exercise their rationale in making the investment decision.
Investing vs Trading
And, what should be your take-away?
The mind-boggling returns generated by Infosys share over the period of last 25 years clearly shows that investing in stock market is better than trading. Notably, legendary investor Warren Buffet, who got in the stock market investment business aged 11 years and is currently the world's 4th richest person with a net worth of $83.6bn, often says that his favorite holding period is "forever".