Shares of Regencell Bioscience Holdings Limited (RGC) plummeted 5.13% in after-hours trading on Tuesday, following the company's announcement of a 38-for-1 forward stock split. This sharp decline comes on the heels of an extraordinary rally that saw the stock surge by more than 46,000% year-to-date, despite the company reporting no revenue.

The biotech firm, which focuses on herbal medicine, declared that shareholders will receive 37 additional shares for each share held as of the record date. While stock splits typically don't affect a company's fundamental value, they often lead to price adjustments as the market digests the news and recalibrates expectations.

Regencell's meteoric rise this year has puzzled many market observers, given the company's lack of revenue or profit. The stock had jumped another 25% in regular trading on Tuesday, adding to its already staggering gains. However, the after-hours plunge suggests that investors may be reassessing the company's valuation in light of the stock split announcement.

As the market prepares for the stock split to take effect, investors will be closely watching Regencell's performance in the coming days. The company's ability to justify its lofty valuation with concrete business developments will be crucial in determining its future stock trajectory.