Lucky Cement Limited has announced a 5-for-1 stock split, aiming to enhance market accessibility, increase liquidity, and attract a broader range of investors.
The decision, disclosed in a notice to the Pakistan Stock Exchange (PSX) on February 21 was approved in a Board meeting held on February 20. The stock split remains subject to shareholder approval at an Extraordinary General Meeting (EoGM) scheduled for March 18.
Once implemented, Lucky Cement’s total outstanding shares will increase fivefold — from 293 million to 1,465 million ordinary shares — while the stock price will adjust proportionally, ensuring no change in overall market capitalization.
Why are stocks split?
Stock splits are a widely used strategy to make shares more affordable for retail investors, increasing market participation and improving trading efficiency. By lowering the price per share, the company seeks to attract small and retail investors, expanding its shareholder base and ensuring higher liquidity without introducing price volatility.
Unlike issuing bonus shares, which have tax implications, stock splits provide a tax-efficient method for shareholders to benefit from company growth.
M. Ali Tabba, CEO of Lucky Cement Limited, highlighted the company’s consistent growth and resilience, attributing its success to strategic reinvestment in expansion.
"Lucky Cement and its subsidiaries have experienced significant growth over the years. This stock split is a way to share our success story with a broader investor base, both locally and globally,” Tabba said.
He further noted that Lucky Cement’s strategy of reinvesting profits has strengthened its market position, making it more resilient to economic shocks.
Citing the company’s previous share buybacks, he emphasized that long-term shareholders who retained their shares have benefited from the company’s sustained growth, with this stock split further reinforcing shareholder value.
