Simple Stocking Holder
Shares in stock exchange India?
Hi
Reg the shares in the stock exchange.
For eg
A company is floating publice shares for 250 crores. like 25000 shares had been alloted at RS 1000/share
Once its started listing lets assumes endo the 15th day its Rs 1200/share.
What does this actually mean to the company?
When the sahre holder buys or sells what impact will the company have moniterily and all other benefits.
can some one explain me in simple language which a common man can understand pls (mean avoiding the terminologies)
Thank u very much for this great help.
Roma
The term which you are talking about is referred to as 'Market Capitalization' or Market Cap of a company.
Market cap is simply the product of the current market price of the stock and the total no. of the shares of the company.
So as the price of the stock increases or decreases, the Market Cap of the company will also increase or decrease.
As you had rightly pointed out, companies will be seriously affected if the Market cap reduces substanitally in a very short duration of time.
Hemce Market cap is also expected for the future by the companies. The Earnings Per Share or the EPS shows the expected increase or decrease in the price of the share of this company for the coming quarters.