Annual report
A company's official yearly account of its financials, strategy, risks and management commentary. The most reliable primary source on a company.
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Plain-language definitions of the terms you will meet while researching Indian equities. Search, or jump in by letter.
A company's official yearly account of its financials, strategy, risks and management commentary. The most reliable primary source on a company.
What a company owns - cash, inventory, property, equipment and receivables.
A snapshot of a company's financial position: assets, liabilities and shareholders' equity at a point in time.
A standard index (like the Nifty 50) used to compare a stock or fund's performance against.
Free additional shares given to existing shareholders in proportion to their holding. It changes share count but not total value.
The net value of a company's assets minus liabilities, i.e. shareholders' equity. Used in the P/B ratio.
An intermediary licensed to execute buy and sell orders on an exchange on your behalf.
The Bombay Stock Exchange, Asia's oldest, founded in 1875. Home of the Sensex index.
When a company buys and cancels its own shares, increasing the ownership stake of remaining shareholders.
The profit from selling an asset for more than you paid. Taxed differently for short-term and long-term holdings in India.
Capital expenditure - money a company spends on long-term assets like plants, equipment and infrastructure.
The actual money moving into and out of a business, from operations, investing and financing.
Central Depository Services - one of India's two depositories that hold shares electronically in demat accounts.
An earnings call where management discusses quarterly results and answers investor questions.
An event that changes a company's shares or payments - dividends, splits, bonuses, rights issues, buybacks.
A leverage ratio comparing a company's debt to its shareholders' equity. High values mean heavy borrowing.
An electronic account where your shares are held in dematerialised form, managed by a depository.
An institution (NSDL or CDSL) that holds securities electronically for investors.
A cash payment to shareholders from a company's profits. Never guaranteed.
Annual dividend per share divided by the share price, expressed as a percentage. A measure of income return.
Systematic research and verification of a company's business, financials, governance and valuation before investing.
Earnings before interest, taxes, depreciation and amortisation - a measure of operating profitability.
A company's total value: market cap plus debt minus cash. Used in EV/EBITDA.
Earnings per share - net profit divided by the number of shares. Shows profit attributable to each share.
Shareholders' stake in a company - assets minus liabilities. Also used to mean stocks.
A valuation ratio comparing a company's total value (including debt) to its operating earnings. Useful for capital-intensive firms.
A marketplace where buyers and sellers trade securities, such as the NSE and BSE.
Foreign institutional investor - overseas funds that invest in Indian markets.
Operating cash flow minus capital spending. The cash available to grow the business or return to shareholders.
How a company is run and controlled - its board, management and treatment of shareholders.
A basket of stocks that tracks a segment of the market, such as the Nifty 50 or Sensex.
A large professional investor such as a mutual fund, insurance company or pension fund.
Initial public offering - a company's first sale of shares to the public on an exchange.
A large, established company, generally among the top 100 by market cap. Usually more stable and liquid.
The use of borrowed money to fund a business. High leverage amplifies both gains and losses.
What a company owes - loans, payables and other obligations.
An order to buy or sell at a specified price or better. It may not fill if the price is never reached.
How easily a stock can be bought or sold without moving its price. Large-caps are more liquid.
When a company's shares begin trading on an exchange, often after an IPO.
In Indian tax terms, holding a listed share for over a year. Long-term gains are generally taxed at a lower rate.
The executives who run a company day to day. Their quality and honesty matter to investors.
The share of sales that becomes profit at a given stage - gross, operating or net margin.
Market capitalisation - share price multiplied by total shares. Sizes a company into large, mid or small cap.
An order to buy or sell immediately at the best available price. Fast but price not guaranteed.
A company in the tier between large and small caps, generally more volatile than large-caps.
A pooled investment managed by professionals that holds many stocks, offering instant diversification.
Net profit divided by revenue - the share of sales left after all costs and taxes.
The bottom line - revenue minus all costs, expenses and taxes. Money available to reinvest or pay out.
The NSE's flagship index of the 50 largest listed companies.
The National Stock Exchange, India's largest by trading volume. Home of the Nifty 50.
National Securities Depository - one of India's two depositories holding shares electronically.
Cash generated from the core business operations, before investing and financing.
Operating profit (EBITDA) divided by revenue - profitability before interest and tax.
The different ways to place a trade, chiefly market and limit orders.
Price-to-book - share price divided by book value per share. Useful for asset-heavy businesses like banks.
Price-to-earnings - share price divided by earnings per share. Shows how much you pay per rupee of profit.
P/E divided by expected earnings growth. A PEG near or below 1 can suggest growth is reasonably priced.
When promoters borrow money against their shares. Heavy pledging is a governance red flag.
The collection of investments you hold.
The founders or controlling shareholders of a company.
The official document for an IPO describing the business, financials and risks. Read it before subscribing.
Transactions between a company and its promoters or connected entities. Complex or excessive ones are a red flag.
The total money a company earns from selling goods or services - the top line.
An offer to existing shareholders to buy new shares, often at a discount, to raise capital.
The chance of losing money on an investment.
Return on capital employed - profit relative to all capital used (debt and equity). Shows capital efficiency.
Return on equity - net profit divided by shareholders' equity. Shows how well the company rewards owners' money.
The BSE's flagship index of 30 large, well-established companies.
A unit of ownership in a company.
A person or entity that owns shares, i.e. a part-owner of a company.
The official breakdown of who owns a company - promoters, institutions and the public.
In Indian tax terms, holding a listed share for under a year. Short-term gains are generally taxed at a higher rate.
A smaller company, generally more volatile and riskier than large or mid-caps.
Another word for a share - a unit of ownership in a company.
Increasing the number of shares by dividing each into more, lowering the price without changing total value.
An order that triggers a sale when a price is reached, to limit losses. Not a substitute for understanding the stock.
The forces that set prices: more buyers push prices up, more sellers push them down.
The rules governing how investment income and gains are taxed in India.
Studying price charts and patterns to predict moves. A tool, not a guarantee.
The combined return from price change and dividends over a period.
The account you use to place buy and sell orders through a broker.
Assessing what a company or stock is worth, using ratios like P/E, P/B and EV/EBITDA.
How much a price swings over time. High volatility means larger, more frequent moves.