Reading Financials3 min read
What is market capitalisation?
The total value of a company on the market. Multiply the share price by the number of shares, and you have it.
Market capitalisation, or market cap, is what the market thinks an entire company is worth. The formula is simple: share price multiplied by the total number of shares outstanding.
Why price alone is misleading
A stock priced at 100 is not 'cheaper' than one priced at 5,000. What matters is the total value. A 100 stock with billions of shares can be far larger than a 5,000 stock with very few. Always look at market cap, not just the price tag.
On MarketByte, market cap is shown in the Indian convention, in crore, on every company page.