Hundred shares of WIPRO grew to be over Rs 3.28 crores in 27 years

How investment in 100 shares of WIPRO grew to be over Rs 3.28 crores in 27 years?

Assume you bought 100 shares of WIPRO in 1990. At that time, the face value of one stock of WIPRO was Rs 10. For simplicity, we are considering that you bought the stocks at the face value. Hence, your initial investment would have been Rs 1,000.

(Note: Stocks in the Indian stock market rarely trade below their face value. Most of the shares trade at a high premium compared to their face value. However, there has been a number of adjustment in the share price of the company since 1990 because of various bonuses and stock split. Therefore, just for simplicity, we are considering that you purchased the stock at the face value. Moreover, when you compare the appreciated value with the purchase price, you’ll understand that it wouldn’t have made much difference even if you had bought this stock at a little premium.)

Since 1990, WIPRO has given seven bonuses to its shareholders and one stock split (till 2017). Let’s also assume that you didn’t touch the stock after buying. This means that you didn’t sell any stock since the purchase and also avoided any profit booking.

• 1990: 100 shares
• 1992: 200 shares (1:1 bonus on 12-08-1992)
• 1995: 400 shares (1:1 bonus on 24-02-1995)
• 1997: 1,200 shares (2:1 bonus on 20-10-1997)
• 1999: 6,000 shares (5:1 split on 27-09-1999)
• 2004: 18,000 shares (2:1 bonus on 25-06-2004)
• 2005: 36,000 shares (1:1 bonus on 22-08-2005)
• 2010: 60,000 shares (2:3 bonus on 15-06-2010)
• 2017: 1,20,000 shares (1:1 bonus on 13-06-2017)

Capital Appreciation:

Let’s find out the current worth of the 100 shares that you bought in 1990.

As of May 2018, the market price of one share of Wipro is Rs 273.75

Total Number of share= 1,20,000
Net Value = Rs 273.75 * 1,20,000 = Rs 3,28,50,000.

• 2014: Rs 8.00
• 2015: Rs 12.00
• 2016: Rs 6.00
• 2017: Rs 4.00

Annual dividend received by the shareholders can be calculated using this formula:

Annual dividend received= Dividend per share * Total Number of shares

Assuming that you bought 100 shares of WIPRO in 1990, here are the annual dividends that you would have received:

• Dividends (2014) = Rs 8 * 60,000 = Rs 4,80,000
• Dividends (2015) = Rs 12 * 60,000 = Rs 7,20,000
• And Dividends (2016) = Rs 6 * 60,000 = Rs 3,60,000

Moreover, for the year 2017, the total number of shares in your portfolio would have turned out to be 1,20,000.

Dividends (2017) = Rs 4 * 1,20,000 = Rs 4,80,000

Overall, you would have received dividends worth Rs 4,80,000 in just an year by literally doing nothing.