{"id":20455,"date":"2024-02-14T06:15:15","date_gmt":"2024-02-14T00:45:15","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=20455"},"modified":"2025-04-06T01:26:37","modified_gmt":"2025-04-05T19:56:37","slug":"market-capitalisation","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/market-capitalisation\/","title":{"rendered":"What is Market Capitalisation?"},"content":{"rendered":"<h2>About Market Capitalisation<\/h2>\n<ul>\n<li>Market Capitalization, or\u00a0Market Cap, is a term used to\u00a0represent the market value of a\u00a0company based on its current share price and the total number of its outstanding shares.\u00a0<\/li>\n<li>It can be\u00a0calculated by multiplying the\u00a0number of outstanding shares of a company\u00a0by the current price of its shares.\u00a0<\/li>\n<li>It\u00a0represents the market\u2019s perception of a company\u2019s worth and indicates its size and significance in the financial markets.\u00a0<\/li>\n<li>On the basis of market cap, companies may be classified as large-cap, mid-cap, or small-cap companies.\n<ul>\n<li>Large-cap companies are usually stable, reputable, and well-established businesses that have a significant market share. They have\u00a0market caps of INR 20,000 crore or more.\u00a0<\/li>\n<li>Mid-cap companies have a market cap ranging from\u00a0INR 5,000 crore to INR 20,000 crore.<\/li>\n<li>Small-cap companies operate at a smaller scale than large-cap and mid-cap companies. Consequently, their market cap is also lower (less than INR 5,000 crore).\u00a0<\/li>\n<\/ul>\n<\/li>\n<li>Why is market capitalization important?\n<ul>\n<li>It\u00a0allows potential\u00a0investors to understand the true value of companies and the size of one company in relation to another.\u00a0<\/li>\n<li>It\u00a0helps investors predict the future performance\u00a0of the stock of a company because it reflects what the market is willing to pay for the stock.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2>What is Free float market capitalisation?<\/h2>\n<ul>\n<li>While calculating the total market capitalization of a company, all the shares, including the ones publicly traded as well as those held by promoters, government, or other private parties, are multiplied with the stock price.<\/li>\n<li>But in\u00a0the free-float market capitalization,\u00a0we exclude shares held by private parties\u00a0like promoters, trusts, or the government.<\/li>\n<li>We\u00a0only consider shares held and traded by the public and multiply them with share price to arrive at the free-float market capitalization of a company.<\/li>\n<\/ul>\n<hr \/>\n<h3>Q1) What are Shares?<\/h3>\n<p>The capital of a company is divided into shares. Each share forms a unit of ownership of a company and is offered for sale so as to raise capital for the company.<\/p>\n<p><strong>Source:<\/strong> <a href=\"https:\/\/www.deccanherald.com\/business\/companies\/reliance-industries-market-capitalisation-hits-rs-20-lakh-crore-2892796\" target=\"_blank\" rel=\"nofollow noopener\"><u>Reliance becomes first Indian company to hit Rs 20 lakh crore valuation<\/u><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Market Capitalisation is a term used to represent the market value of a company based on its current share price and the total number of its outstanding shares. <\/p>\n","protected":false},"author":5,"featured_media":20456,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":{"0":"post-20455","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-prelims-current-affairs","8":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/20455","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=20455"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/20455\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/20456"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=20455"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=20455"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=20455"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}