Nahar Export Ltd

 Nahar Exports: Current Price Rs.100 - PE 9.3
Nahar Spinning : Current Price Rs.280- PE 31.1

Nahar Exports has decided to hive off Textile Business and merge it with Nahar Spinning. Both Companies are in for a Stock split. From Rs.10 to Rs.5.

After the hive off, All those who hold shares in Nahar Exports would receive Shares of Nahar Exports and Nahar Spinning as follows, AFTER STOCKSPLIT:

If you hold 100 Shares of Nahar Exports, you would receive 70 shares of Nahar Exports and 55 Shares of Nahar Spinning

Cost of 100 Shares of Nahar Exports- ~Rs.10,000
Assume that price of Nahar Exports remain at Rs.100 and Nahar Spinning at Rs.280. (Well both are rising and should go up further) After Stock Split, if price remains same as above, Nahar Export will be at Rs.50 and Nahar Spinning at Rs.140.

Assuming Prices remaining as above
You will get 70 shares of Rs. 5 Face Value Nahar Exports@~Rs.50 = 3500
You will get 55 shares of Rs.5 Face Value of Nahar Spinning @~140 =7700
Total= Rs.11200 at lowest