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| Market Cap Or Market Capitalization |
➤ Market Cap Formula
Market Cap = Total Number of Outstanding Shares x Current Market Price per Share
➤ Example
Let's say a company has 10 million outstanding shares, and the current market price is ₹100 per share. The market cap would be:
Market Cap = 10,000,000 shares x ₹100/share = ₹1,000,000,000
➤ Market Cap Categories
Companies are often categorized based on their market cap:
➤ Large-cap: ₹20,000 crore and above
➤ Mid-cap: ₹5,000 crore to ₹20,000 crore
➤ Small-cap: ₹1,000 crore to ₹5,000 crore
➤ Micro-cap: Below ₹1,000 crore
➤ Importance of Market Cap
Market cap is an important metric for investors, as it can indicate a company's size, stability, and growth potential. It can also influence investment decisions and stock prices.
➤ Uses of Market Cap
Market cap is used to:
➤ Evaluate a company's size and market position
➤ Compare companies within the same industry
➤ Determine investment potential and risk
➤ Track market trends and performance
By understanding market cap, investors can make more informed decisions and navigate the stock market with confidence.