Large Cap Definition – Meaning and Example

Large Cap Definition, Meaning and Example

Large Cap Definition – “It refers to those companies whose market capitalization is greater that Rs. 10,000 crore”.

In simple words, large cap consists of stocks of all those companies which are usually large in size and have a strong market presence. At the same time, these companies comes in the category of safe investments. The best things about the large cap companies is that, all the information related to them are readily available. There is full disclosure of each and every information plus most of the people have good knowledge about these entities.

Before going further let’s first discuss what is market capitalization. It refers to the product of current stock price and number of shares outstanding.

Market Capitalization = Current Stock Price × Number of Share outstanding

For example – ABC company has 10,00,000 of share outstanding in the market. The current trading price of the share is Rs. 10.

So Market Cap = 10,00,000 × 10

                                               = 1,00,00,000

Large Cap Example

Let’s discuss few companies along with their market capitalization in order to get a more clear ides about Large Cap definition –