Share consolidation

Share consolidation, often referred to as reverse stock split, is a corporate action where a company reduces the total number of its outstanding shares. This move is typically undertaken to increase the market value per share, making the stock more appealing to investors. By consolidating shares, a firm aims to enhance its public image and stay compliant with stock exchange listing requirements, which often have minimum price thresholds. Another key benefit is the improvement in shareholder perception, as higher share prices can suggest a more robust and stable company. Despite reducing the number of shares, the overall value of the investment remains unchanged, as the reduction in quantity is counterbalanced by a proportionate increase in price per share.