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- SBI Top Loser | Market Cap Falls ₹53,953 Cr; ICICI & HDFC Bank Value Down
Mumbai51 minutes ago
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The value of 8 of the country’s 10 largest companies in terms of market capitalization declined by Rs 2.81 lakh crore in last week’s trading. During this period the value of SBI decreased the most. SBI’s market cap declined by Rs 53,953 crore to Rs 10.55 lakh crore.
ICICI Bank’s market value declined by ₹46,937 crore to ₹9.40 lakh crore. Whereas the market cap of HDFC Bank declined by Rs 46,552 crore to Rs 13.19 lakh crore.
Value of Reliance and Infosys increased
Apart from these, the market cap of Larsen & Toubro, Bajaj Finance, TCS, HUL and Bharti Airtel also decreased. Last week only the value of Reliance Industries and Infosys increased.
Reliance’s market cap increased by Rs 14,750 crore to reach Rs 19.01 lakh crore. Infosys’ market value increased by Rs 3,459 crore to Rs 5.30 lakh crore.
Sensex fell 1097 points on Friday
The stock market was falling on Friday, March 6. Sensex fell 1097 points (1.37%) to close at 78,919. Nifty also declined by 315 points (1.27%). It came to 24,450.
There is a risk of inflation increasing in situations like geopolitical tension and war. This may reduce the profits of companies. In such a situation, investors start selling their shares and invest them in safe places like gold and silver. This causes a decline in the market.
What is market capitalization?
Market cap is the value of the total outstanding shares of any company, i.e. all those shares which are currently held by its shareholders. It is calculated by multiplying the total number of issued shares of the company by their price.
Understand this with an example…
Suppose… people have bought 1 crore shares of company ‘A’ in the market. If the price of a share is Rs 20, then the market value of the company will be Rs 1 crore x 20 i.e. Rs 20 crore.
The market value of companies increases or decreases due to increase or decrease in share prices. There are many other reasons for this…
| what does it mean to grow | what does decrease mean |
| increase in share price | decline in share price |
| strong financial performance | bad results |
| positive news or event | Negative news or event |
| positive market sentiment | Economy or market decline |
| Issuing shares at high price | Share buyback or delisting |
What effect do market cap fluctuations have on the company and investors?
Impact on the company: A large market cap helps the company to raise funds from the market, take loans or acquire other companies. At the same time, small or low market cap reduces the ability of the company to take financial decisions.
Impact on investors: Investors directly benefit from increasing market cap. Because the price of their shares increases. At the same time, the fall may cause losses, due to which investors may decide to sell shares.
Example: If TCS’s market cap grows by ₹12.43 lakh crore, investors’ wealth will increase, and the company may get more capital for future investments. But if the market cap falls then it may incur losses.
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