BSE Shares Drop 66% Overnight: But It’s Not What It Seems

Lucky Negi
6 Min Read

On May 23, 2025, many investors were left confused and alarmed when they saw that the BSE share price had dropped by more than 66% overnight. Social media was buzzing with questions like:

  • “Is the market crashing?”
  • “Should I sell my BSE stocks?”
  • “What went wrong with BSE today?”

But here’s the truth—there was no crash. This sharp drop in price was due to a bonus share adjustment, not because of any negative company news.

In this article, we’ll explain what actually happened, what a bonus issue is, and why you should not worry. We’ll also talk about how this event fits into a broader understanding of investing in the stock market.

📉 Why Did the BSE Share Price Fall So Much?

The Bombay Stock Exchange (BSE) recently announced a 2:1 bonus share issue. That means for every 1 share you owned, you received 2 extra sharesfor free.

Here’s a simple example:

  • Suppose you had 10 shares of BSE, and each share was priced at ₹3,000.
  • However, the price of each share changes in keeping with this to maintain the same overall worth of your investment.
  • So now, each share is priced at around ₹1,000.

💡 Result: The total value of your investment remains ₹30,000, even though the share price has dropped.

This is why the BSE share price fell by over 66% overnight—it was mathematics, not market panic.

📘 What Is a Bonus Share and Why Is It Issued?

Bonus shares are free shares that a business gives to its current owners. Usually, the company’s reserves or earnings are used to fund it. Bonus shares do not involve any cash payment by the investor.

🟢 Why do companies issue bonus shares?

  1. To reward shareholders for their trust and loyalty.
  2. To increase liquidity in the stock market.
  3. For the purpose of decreasing the share price in order to draw in new investors.
  4. To increase retail participation and broaden the investor base.

BSE issued the bonus shares as a positive move—to increase trading volume and attract new investors. This shows that the company is in a strong financial position and confident about its future.

🔍 Don’t Be Misled—Understand Bonus Adjustments

It’s common for new investors to get nervous when they see such a steep price drop. But it’s important to understand the reason behind such changes.

Bonus shares do not reduce the value of your investment. Instead, they simply spread your value across more shares.

➕ How is it different from a stock split?

  • In a stock split, the number of shares increases and the face value is reduced.
  • New shares are issued in a bonus issue, but the face value remains unchanged.

🔑 Example for clarity:

Let’s say you owned 1 BSE share worth ₹3,000.

  • After a 2:1 bonus, you now have 3 shares.
  • The new share price is ₹1,000.
  • Total value = 3 x ₹1,000 = ₹3,000 (No change)

So while it might look like a crash, it’s just a technical share price adjustment.

📈 How Should Investors React to the BSE Bonus Issue?

For long-term investors, this is actually good news. BSE is rewarding its investors and improving stock liquidity. You now own more shares, which gives you better flexibility in the future.

Here’s what you should do:

Don’t panic. The value of your investment hasn’t gone down.
Review your portfolio. Make sure your investment goals are still on track.
Use this chance to learn. Understanding bonus shares helps you become a smarter investor.
Stay informed. Follow stock market news through reliable sources.

Important Dates:

  • Bonus Record Date: May 24, 2025
  • This is the date to check who qualifies for the bonus shares.

If you owned BSE shares before this date, you will receive the bonus shares.

🧠 Understanding Stock Market Basics Is Key

The Indian stock market can be volatile and unpredictable. But not all price drops mean something bad has happened. Events like bonus issues, stock splits, and dividend payouts often cause changes in share prices that are completely normal and planned.

If you’re just starting out in share market investing, make sure to learn about:

  • NSE vs BSE
  • What is Net Banking for stock trading
  • How online trading works
  • Types of investment accounts
  • How bonus shares and dividends affect stock prices

These concepts will help you build strong financial knowledge and invest more confidently.

✅ Final Thoughts

So, did the BSE share price crash on May 23? Not really. What happened was a planned bonus share adjustment that led to a change in the per-share price.

The value of your investment is safe, and in fact, this bonus issue reflects positively on the company’s financial health.

If you see such price drops in the future, always check if there’s a corporate action involved before making decisions.

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I am a digital marketing executive as well as content writer in the business category. My goal is to provide simple, interesting and reliable information to readers through my articles so that they always stay updated with the world of business
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