In terms of market valuation, the value of 6 of the country’s top 10 companies has decreased by Rs 70,326 crore in this week’s trading. HDFC Bank was the top loser during this period. The market cap of the largest private sector bank has decreased by ? 19,285 crore to ? 15.25 lakh crore last week. ICICI Bank’s market cap has decreased by ? 13,567 crore to ? 10.29 lakh crore during this period. At the same time, Bajaj Finance has declined by ? 13,236 crore, LIC by ? 10,246 crore, TCS by ? 8,032 crore and Airtel’s valuation has declined by ? 5,959 crore. At the same time, the value of the country’s largest private sector company Reliance Industries has increased by ? 15,359 crore to ? 20.67 lakh crore. Last week, Infosys added ?13,128 crore to its valuation. Now the value of the company has reached ?6.81 lakh crore. What is market capitalization? Market cap is the value of the total outstanding shares of any company, that is, all the shares that are currently held by its shareholders. It is calculated by multiplying the total number of issued shares of the company by their price. Understand it with an example… Suppose… People have bought 1 crore shares of company ‘A’ in the market. If the price of one share is Rs 20, then the market value of the company will be 1 crore x 20 i.e. 20 crore rupees. The market value of companies increases or decreases due to the increase or decrease in share prices. There are many other reasons for this… 1. What does the increase in market cap mean? 2. What does the decrease in market cap mean? 3. What effect does the fluctuation in market cap have on the company and investors? Effect on the company: A large market cap helps the company to raise funds from the market, take loans or acquire other companies. On the other hand, a small or low market cap reduces the company’s ability to take financial decisions. Effect on investors: An increase in market cap directly benefits investors. Because the price of their shares increases. At the same time, a fall can lead to losses, due to which investors can decide to sell shares. Example: If the market cap of TCS increases by ? 12.43 lakh crore, then the wealth of investors will increase, and the company can get more capital for future investment. But if the market cap falls, it can cause losses. 4. How does market cap work? On Friday, the Sensex closed 193 points higher at 83,433 On the last trading day of the week, Friday, July 4, the Sensex closed 193 points higher at 83,433. Nifty rose by about 56 points, closing at 25,461. 20 out of 30 Sensex stocks were up. Trent share fell by 11%. Tata Steel and Tech Mahindra fell by 1.6%. Bajaj Finance, Infosys and HUL increased by 1.6%. 31 out of 50 Nifty stocks were up. NSE’s pharma, realty, oil & gas and FMCG shares closed with a gain of up to 1%. Auto and metal witnessed a slight decline. The market had fallen by 626 points during the entire week.
