1.
Face value:
2.
Book value
3.
Promoter holding
4.
Debt/equity ratio
5. Price
history
1.
Face value-
Whenever a company is registered with the Registrar
of Companies, in the official documents like Memorundum of Association etc, the
promoters mention how much authorised capital it will have, how much paid up
capital it will have and in how many shares this capital will be raised, It
also mentions the initial value of the shares to be issued as face value. It
could be Rs.100/- , Rs.10/-, Rs.5/-, Rs.2/- or Rs.1/-. E.g. Authorised capital
of Rs.100000/- to be divided into 10000 shares of fave value of Rs.10/-.
The price band when these shares are offered to the
public depends on various factors. Like how strong the company is financially,
who are the promoters, how many shares to be issued etc. This price will vary
significantly from the face value. The price finding is worked out by the
merchant bankers and the promoters of the company depending on these and other
parameters.
2.
Book value
The book value of a company tells us what the each
share of a company is worth. Means if you bought a share at Rs10, and its book
value is Rs11, means you must buy that share. Also, assume that a company in
its IPO offered shares at par of Rs 10 per share, and the present book value is
Rs 24 per share, it means that the investment by the shareholders has
appreciated by Rs 14 per share.
3.
Promoter holding
An individual or company that, for a fee, helps
raise money for some type of investment activity. Most often, promoters raise
money for a company through offering investment vehicles other than traditional
stocks and bonds, such as limited partnerships and direct investment
activities. Often times, these promoters are paid in company stock or free
entrance into the investment activity as compensation for their work in raising
funds from others.
Investopedia explains Promoter
While there are plenty of legitimate investment
promoters out there, one should always do their homework before investing in
the activities they represent. Due to the fact that many of the investments
promoted by these individuals are not formally registered with the Securities
and Exchange Commission, an investment area plagued with fraud, professional
promoters have been linked to an inordinately high number of investment scams
and litigation.
4.
Debt/equity ratio
A measure of a company's financial leverage.
Debt/equity ratio is equal to long-term debt divided by common shareholders'
equity. Typically the data from the prior fiscal year is used in the
calculation. Investing in a company with a higher debt/equity ratio may be
riskier, especially in times of rising interest rates, due to the additional
interest that has to be paid out for the debt.
For example, if a company has long-term debt of
$3,000 and shareholder's equity of $12,000, then the debt/equity ratio would be
3000 divided by 12000 = 0.25. It is important to realize that if the ratio is
greater than 1, the majority of assets are financed through debt. If it is
smaller than 1, assets are primarily financed through equity.
5.
Price history
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