IMPACT OF STOCK SPLIT ANNOUNCEMENT ON STOCK PRICES

Corporate events have numerous effects on the stock market and it is been observed that stock price movements is an area of research that attracted the attention of various researchers. Therefore, the present study attempts to contribute to the understanding of the behavior of Indian share prices in relation to stock split announcements. A standard event study methodology is adopted in this study to examine the impact and price reactions of CNX Nifty companies of NSE from January 2006 to December 2013 surrounding sixty days of the announcement dates. Abnormal returns were calculated and t-tests are conducted to test the significance. From the study, it can be inferred that stock split announcement have positive impact of stock prices around announcement dates.