Market capitalization is the total value of a company’s outstanding shares of stock and is calculated by multiplying the current stock price by the number of outstanding shares. The classification of companies into these categories is based on their market capitalization.
Large Cap (Large Capitalization):
Market Cap Range (in Rupees): Typically, large-cap companies have a market capitalization exceeding ₹70,000 crores or ₹35,000 crores, depending on the context.
Characteristics: Large-cap companies are generally well-established, often industry leaders with a history of stable earnings. They are considered less risky than smaller companies and may have a global presence. Examples include Reliance Industries, Tata Consultancy Services (TCS), and HDFC Bank.
Mid Cap (Mid Capitalization):
Market Cap Range (in Rupees): Mid-cap companies typically have a market capitalization between ₹14,000 crores and ₹70,000 crores, though the range may vary.
Characteristics: Mid-cap companies are often in a phase of growth and expansion. They may have established themselves in their respective markets but might not be as mature as large-cap companies. Investors in mid-cap stocks seek a balance between growth potential and risk.
Small Cap (Small Capitalization):
Market Cap Range (in Rupees): Small-cap companies usually have a market capitalization below ₹14,000 crores or ₹7,000 crores, though these thresholds can vary.
Characteristics: Small-cap companies are often younger and may be in the early stages of development. They can offer significant growth potential, but they also tend to be riskier than larger companies. Small-cap stocks may be more volatile and less liquid.
These values are approximations and can vary based on the specific financial context, market conditions, and currency exchange rates. Investors considering the equivalent terms in rupees would need to adapt these thresholds based on the prevailing financial landscape in India.
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