Published Paper Details:

Corporate actions of companies listed in stock market plays a major role in fluctuations of share prices. As a part of it companies announces two types of stock splits such are Forward stock split and Reverse stock split. Generally investors perceive stock split announcements in a positive way. Hence, it is interesting area for researchers. Thus, here we tried to study the impact of reverse stock splits on stock returns and trading volume with reference to cumulative abnormal returns (CAR) and cumulative average abnormal returns (CAAR) and changes in trading volume by selecting 30 reverse stock splits announced by companies listed in Bombay Stock Exchange during the period of 2015 to 2022. This is a quantitative research and purposive sampling method used. The source of data used in this research is secondary data obtained from BSE, CMIE Prowess database, Moneycontrol.com and Yahoo finance. The Single factor Market model, Event study methodology, Paired sample t-test used for analysis with the help of SPSS and MS Excel. An Event window of 61(t-30 to t+30) days and Estimation window period of 252 days prior to reverse stock split announcements used to analyze stock returns and changes in trading volume. The findings of the study reveal that reverse stock splits resulted positive returns on stocks and significantly impacts on trading volume of stocks.