- 1,804,884 options granted on October 05, 2009 (‘Grant 2’), value per option as per this Intrinsic value method was Rs 24.85
- 5,422,954 options granted on December 23, 2009 (‘Grant 3’), value per option as per this Intrinsic value method was Rs 46.25.
Now, the pricing would have been decided before hand. But the intrinsic value(as opposed to merely the market price) would not have changed that dramatically within 2 months. Due to market fluctuations, the option value dramatically rose under the intrinsic value method. While under BSM(Black Scholes Merton) model, this volatility would have been slightly toned down in the pricing formula
Conclusion:- For high Beta stocks(like this one), intrinsic value ESOP valuation may result in casino like ESOp expense figures.