KARACHI: Lucky Cement has announced plans to sub-divide its shares, reducing the face value from Rs10 to Rs2 per share in a five-for-one stock split, the company announced in a stock exchange filing on Friday.

Once the stock split becomes effective, the existing 293 million ordinary shares will be multiplied by the stock split factor of 5, resulting in 1,465 million ordinary shares.

Each share`s pre-split stockpricewillbe divided by the same factor.

The recommendation was made in its board meeting held on Thursday, which is subject to approval by its shareholders in an Extraordinary General Meeting (EoGM) to be held on March 18.

Stock splits are a common strategy companiesuse worldwide to enhance market accessibility, liquidity, and investor participation. By reducing the price per share, companies make their stock more affordable to a broader range of investors, particularly small and retail investors, fostering a more inclusive shareholder base. A split also increases the number of shares in circulation, improving market liquidity and making trading more efficient without causing price volatility.

Moreover, a stock split signals confidence in a company`s financial strength and long-term prospects, reinforcing investor trust and positioning the company for sustained success. Unlike issuing bonus shares with tax implications, stock splits provide a tax-efficient mechanism for shareholders to benefit from a company`s growth.