In this tutorial, we will explain how you can compute capital gains accurately considering corporate actions in MProfit.
Follow the steps below:
Step 1: Login to your MProfit account and select the asset.
Here, we have taken Reliance Industries as an example.
Step 2: In the next window, keep the Period as All To Date from the drop-down list.
Step 3:
Purchase of Shares
Bought a hundred shares at a price of 100 rupees per share.
Total purchase amount: 10,000 rupees.
Demerger
On July 20, 2023, Reliance Industries was demerged into Jio Financial Services.
Ratio: One share of Reliance Industries to one share of Jio Financial Services.
Cost allocation ratio: 95.32% for Reliance Industries and 4.68% for Jio Financial Services.
Selling Shares
On March 14, 2024, sold all hundred shares at the price of two hundred rupees per share.
Adjusted purchase price per share: 95.32 rupees (due to the demerger).
Cross-Checking
Verify the selling price (200 rupees) and the adjusted purchase price (95.32 rupees) for accuracy.
Access the Reports section located at the top right side for verification.
Step 4: Select Capital Gains.
Step 5: Next, select Capital Gains-ITR Format.
Step 6: Click Stocks.
Step 7: Click Generate Report.
Step 8: Here, we observe that the buying price stands at ninety-five point three two.
This illustrates how demergers are handled within MProfit for Reliance NGO.
Likewise, let's consider another instance involving HDFC Bank and HDFC Limited.
Step 9: Here, we have taken HDFC Bank as an example.
Step 10:
Initial Purchase (January 5, 2022)
Purchased 100 shares at ₹50 per share.
Total amount: ₹5000.
Merger (July 13, 2023)
HDFC Limited merged into HDFC Bank at a ratio of 25:42.
After the merger, left with 84 shares of HDFC Bank.
Average purchase price after merger: ₹71.43.
Sale (March 16, 2024)
Sold 150 shares at ₹500 per share.
Applying FIFO method:
First, sold the initial 100 shares purchased at ₹50 per share.
Then, sold 50 shares from the remaining 84 shares purchased at ₹71.43 per share.
Verification in Reports
Access the Reports to verify the transactions and calculations.
