How does reverse split ratio work?

The reverse split ratio shows how many existing shares are combined into one new share. Here's an example:

• Before Reverse Split:
  • Shares Owned: 50
  • Price per Share: ₹20
  • Total Value: ₹50 × ₹20 = ₹1000
• After Reverse Split (1:5 ratio):
  • New Shares: 50 ÷ 5 = 10
  • New Price per Share: ₹20 × 5 = ₹100
  • Total Value: ₹10 × ₹100 = ₹1000

The total value of your holdings remains the same because the number of shares decreases while the price increases proportionally.