The company, which had a net profit of Rs 81.34 crore in the previous fiscal quarter, said it intends to raise up to Rs 750 crore through a rights issue to its shareholders.
Apollo Hospitals Enterprise reported a net profit of Rs 146 crore for the March quarter, up 50.5 percent from Rs 97 crore the previous year. The bottom line, however, fell far short of the analyst’s projection of Rs 198 crore.
The company, which had a net profit of Rs 81.34 crore in the previous fiscal quarter, said it intends to raise up to Rs 750 crore through a rights issue to its shareholders.
Revenue climbed by 21.3 percent to Rs 4,302.2 crore in the third quarter, meeting forecasts of Rs 4,302.7 crore. The company’s revenue in the previous year’s similar quarter was Rs 3,546.4 crore.
However, the company’s standalone net revenues increased to Rs 1,203.69 crore for the quarter under review, up from Rs 998.18 crore for the same period a year ago, according to a BSE filing by Apollo Hospitals Enterprise.
As a result, the EBITDA (earnings before interest, taxes, depreciation, and amortisation) margin fell to 11.4 percent from 13.1 percent in the previous quarter.
In a separate filing, Apollo Hospitals stated that its Board of Directors has agreed to recommend a dividend of Rs 5.75 per share (115 percent of the share’s face value) for the fiscal year.
The company’s Digital Health division posted an EBIT (earnings before interest and taxes) loss of Rs 84.4 crore, up from Rs 74.2 crore in the previous quarter. The arm’s EBIT loss in the previous quarter was Rs 8 crore.
Since the digital arm’s losses increased quarter over quarter in Q4, analysts and investors will be looking for management’s comments on its digital business and the hospital segment’s prospects.
The business also stated that it will cover the losses at Apollo HealthCo through internal accruals over the next six months, implying that the hospital giant’s margin pressure will likely remain year on year in the coming quarters.
Despite posting solid Q4 earnings in 2023, Indian Railway Catering and Tourism Corporation’s share price today was under selling pressure. Today’s opening gap to the negative led to the IRCTC share price hitting an intraday low of $627.30 per share on the NSE, a decrease of about 3% from Monday’s closing of $645.75 per share.
IRCTC Q4 results 2023 are in line with market expectations, thus stock market experts advise positioning investors to take advantage of this decrease in share price as a purchasing opportunity. So, shortly after the stock market opened today, profit booking in IRCTC shares was triggered. They claimed that the level of 605 per share provides solid support for the price of IRCTC stock. According to experts, ITCTC shares have resistance at 650 and once clearing this barrier, it may turn positive for the short to medium term and increase to levels of 727 per share.
IRCTC share prices are dropping due to the profit booking trigger in early morning deals, according to Chandan Taparia, a derivative and technical analyst at Motilal Oswal. IRCTC’s Q4 2023 earnings were in line with forecasts yesterday, and as a result, profit taking in the stock began as soon as the market opened today. However, as the company is anticipated to rebound rapidly from its current lows, investors should view this dip in IRCTC shares as a buying opportunity.
According to Chandan Taparia, the IRCTC share price has a hurdle set around 650 per share levels, and once it overcomes this immediate resistance, set at 650 per share levels, it may turn very bullish. He recommended IRCTC stockholders to hold onto their shares since they could experience a substantial rebound from current lows.
What is IRCTC stand for?
The IRCTC is the Indian Railway Catering and Tourism Corporation. The Ministry of Railways formed an Indian Railways subsidiary to manage catering, tourist, and online ticketing services. Mahendra Pratap Mall is the IRCTC’s current (as of October 2017) chairman and executive director.
Goals of IRCTC?
Be simple to utilise.
Utilise resources as efficiently as possible while enhancing human resource effectiveness.
progress in the agency sector and a merger to create a catering service with exceptional efficiency.
In order to create commercial prospects, make use of public-private partnerships.
Expand High standards, business ethics, processes for ensuring quality, and cost management.
Where is the headquarter of IRCTC?
IRCTC is headquartered in New Delhi, India.
IRCTC Mission?
Utilising industry best practises, to enhance customer service and facilitation in the train catering, hotel, transport, and tourism sectors.
Advantages of IRCTC?
IRCTC provides a variety of amenities, including the opportunity to check seat and ticket availability.
You can make a trekking map available to frequent travellers.
Tatkal ticket reservations are available.
However, There are alternatives for booking special trains.
enables customers to make online payments using a credit or debit card, net banking, or both.
A flight booking service is also available.
Disadvantages of IRCTC?
Due to the high volume of users creating tickets on this website, sluggish replies or hangs may occur.
It’s possible that your payment gateway will not work properly once you’ve completed the entire ticket booking form.
Your bank account will be debited without a ticket being printed.
IRCTC share price target 2023
Chandan Taparia of Motilal Oswal revealed a money-making technique for IRCTC shares, saying. Also, .”One can buy IRCTC shares at around 630 apiece levels for immediate target of 650 and 670 maintaining.”
Furthermore, According to Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher, who shared Chandan Taparia’s opinions, the IRCTC share price “bottomed out near the 560 zone and given a decent pullback towards 630 levels where the stock has been in consolidation and currently has given a strong positive candle to indicate a breakout above the rectangular box anticipating for further upside move with improvement in the bias. After a brief drop, the RSI has recovered strength to recommend a buy, with significant upside potential to maintain the trend.
Keep a close eye on the share price objective if you’re an investor looking for long-term gains in the Indian Railway Catering and Tourism Corporation Limited (IRCTC). Analysts have set price targets of $2800 and $3000, which, if purchased in advance of forecasts, could both be reached with respectable returns in a short period of time.
IRCTC is expanding significantly, and after the business splits its stock, the share price target is anticipated to rise. Although, The first anticipated aim for 2023 is 730.498, while the second is expected to be 752.464.
IRCTC Share Price Target 2023
First Target
₹730.498
Second Target
₹752.464
IRCTC Q4 results 2023
IRCTC reported a net profit of 278.8 crore in the fourth quarter of FY23, up from 214 crore in the same quarter a year earlier. IRCTC reported double-digit year-over-year growth in all major metrics and recommended a 100% dividend for its shareholders. In Q4FY23, operating revenue increased by 39.7% to $965 crore from $691 crore in Q4 of the previous fiscal year.
So, you’ve made the decision to begin investing. You already know that a firm with a lot of cash on its balance sheet is superior to one with debt on its balance sheet, that a low P/E ratio is typically better than a high P/E ratio, and that analyst recommendations should always be taken with a grain of salt. You also know that a portfolio should be diversified over a number of sectors, which is the golden rule of the wise investor.
Whether or not you’ve navigated through the more challenging ideas of technical analysis, that pretty well covers the fundamentals. You’re prepared to choose stocks.
But hold on! How can you pick a few stocks that are worthwhile to buy out of the tens of thousands of options available? Regardless of what some industry experts may claim, it is simply not possible to scrutinize every balance sheet to find businesses that have a good net debt position and are increasing their net margins.
KEY TAKEAWAYS
Establish your goals for your portfolio and stick to them.
Choose a sector that appeals to you, and learn about the news and trends that shape it every day.
Focus on the figures and the company or companies that are leading the sector.
Be aware that stock picking underperforms passive indexing frequently, particularly over longer time horizons.
How to pick the best stocks to invest in
Study the industry and have an understanding of it. This includes performing fundamental and technical analysis to estimate a stock’s fair value as well as researching a company’s future prospects to make sure they are consistent with your strategy and objectives.
Use a mixture of quantitative and qualitative stock analysis to build your portfolio. By doing this you can create an approach that works for you
When making investment decisions, keep emotion at bay. Avoid buying stocks just because they are popular and take your time making buying or selling decisions.
Make careful to diversify your investments to reduce your risk.
Due to the ability to reinvest dividends to grow a holding, many investors favor stocks that pay dividends. As a result, in addition to capital growth related to the initial amount deposited, the return on investment is also based on any dividends that are accumulated during the course of the position. Others, who prefer to pick stocks with solid fundamentals and invest using Warren Buffett’s value philosophy, are less concerned with dividends.
How to use fundamental analysis to choose stocks
If you want to choose stocks using fundamental analysis, there are a few steps to take. First, remember that the main goal of fundamental analysis is to determine the intrinsic value of a stock. This implies that you should analyze both qualitative and quantitative aspects of the economy, as well as the various economic sectors and the individual businesses that comprise each sector.
Qualitative factors
Qualitative factors to consider include:
company news
personnel changes
financial events
1.Company news
Stock prices can go up or down in response to news about the business you want to invest in. This is due to the fact that people frequently buy stocks in response to positive news while selling them in response to negative news. Supply and demand are impacted, which ultimately affects the share price.
2. personnel changes
Personnel changes, such as management restructures, are very important to those looking for stocks because they have an impact on how the market perceives them. Any personnel adjustments may have an impact on the company’s reputation, which has a direct bearing on stock prices.
3. financial events
When choosing stocks, it’s critical to consider financial events because they can increase market volatility and uncertainty. Interest rate decisions, planned management changes, and significant occurrences like Brexit are examples of economic events.
Trading strategy is a technique used by stock market traders to purchase and sell shares during trading hours. Its primary goal is to establish the best approach for the trader to book profits while protecting against any hazards.
Active traders can also trade a wide range of financial instruments such as stocks, bonds, currencies, and commodities. Option, futures, and derivatives may also be used to hedge investments or improve prospective returns.
Several trading techniques based on trade kinds have been created. The right strategy can safeguard traders from market volatility, provide a variety of trading chances, and make buying and selling easier inside market sessions.
KEY TAKEAWAYS
A trading strategy is an approach to the stock market in which traders buy and sell shares during a trading session.
Scalping exploits minor price differences in the very short term.
Long and short equities, swing, scalping, news trading, pair trade, trade signal, and social trading are all important trading methods.
Swing traders can hold positions from days to weeks or even months. The swing trader will rely heavily on technical analysis to identify when to enter and exit a position.
Using technical analysis and indicators, a trader may quickly design a strategy that balances market volatility and momentum and shows the trend.
Opening and closing positions inside the same trading day is referred to as day trading.
1.Scalping
Scalpers typically keep a trading position for a relatively short length of time, ranging from a few seconds to a few minutes, with the goal of profiting on small price movements.
Because of the frequency with which scalpers trade, these costs can be significant if not managed efficiently. Furthermore, scalping necessitates quick decision making, focus, and discipline, as scalpers must be able to enter and exit positions quickly in order to capitalise on small price movements.
2.Choosing the Appropriate Market (Options, Equity, Forex, Futures):
Once a trader has gathered enough information about the stock market, they can select their trading instrument. A person, for example, can devise an equity or derivatives strategy.
3.Day Trading
Day traders seek to profit from price swings in a security and often close all of their holdings before the market closes for the day.
The general public frequently equates day trading with individual investors who work from home or a small office and trade securities with their own money. Day traders, on the other hand, work for huge financial institutions such as banks, brokerage firms, and hedge funds.
4.Swing Trading Strategy:
This technique is centred on spotting swing patterns created by price volatility and tries to profit from short-term trends. It is often used for long-term trading that lasts more than a day but less than a month.
5.News Trading:
This approach entails trading in response to news and events concerning a specific stock, such as revenue results, annual reports, mergers and acquisitions, and so on.
6.Position Trading
The goal of position trading is to profit from market trends rather than short-term price movements. Scalping, day trading, and swing trading are all more active than position trading. This strategy is often used by institutions with a piece of their trading book.
Position traders typically utilise fundamental analysis to find equities that are undervalued or overvalued, and they maintain these positions for the long term while waiting for the market to correct itself.
How Do I Get Started with Active Trading?
Being an active trader necessitates a thorough understanding of financial markets, trading tactics, and risk management measures. To get here, one must first learn the fundamentals of financial markets and trading.
Create a trading strategy next. Following that, select a broker and practise trading and the trading method on a simulated account.
How Do I Swing Trade?
Firstly one must learn the basics of swing trading. This involves understanding the concept of swing highs and lows, identifying trends and using technical indicators to analyze the market. Then one should choose a market to trade such as stocks, currencies or futures.
Technical analysis is frequently used to identify swing highs and lows, trend lines, and support and resistance levels.
Positions should be watched and, if necessary, changed based on market conditions. Finally, post-trader analysis should be performed to fine-tune one’s swing trading strategy.
There are various reasons why people chose the career of a stock trader. Others appreciate taking risks and seeing them pay off, while some prefer working in a fast-paced setting where the work is constantly changing. If you’ve ever considered working in the stock market, it can be a successful career path. What a stock trader does and how to become one are both covered in this article.
What does a stock trader do?
A professional that buys and sells stocks is known as a stock trader. They could be self-employed or employed by a business. Stock traders profit by taking advantage of price fluctuations on the stock market. Financial counselors and stock traders both serve as money managers for their clients.
Stock traders can run their own businesses, work for banks, or devote most of their time on the trading floor. Stockbrokers and stock traders must exchange information. Additionally, they execute paperwork, place buy and sell orders, and trade equities on electronic networks.
How to Trade Stocks
Each year, millions of novices try their luck at the market casino, but the majority fail to realize their full potential and leave a little poorer and a lot wiser. The majority of unsuccessful people all share one thing in common: they lack the foundational knowledge required to change the odds in their favor. However, if one invests enough time in learning them, one may be well on their way to boosting their chances of success.
Millions of beginners try their luck at the market casino each year, but the majority don’t succeed in reaching their full potential and depart a little worse off and a lot wiser. Most failed people all have one thing in common: they don’t have the fundamental information needed to tip the scales in their favor. To increase one’s chances of success, one may, nevertheless, be well on their way if they take the time to understand them.
Start by conducting a thorough self-analysis of your relationship with money. Do you see life as a struggle where you have to work hard for every dollar? Do you think your personal magnetism will help you succeed in the market the same way it does in other areas of your life? More concerning, have you consistently lost money in past endeavors and fervently hope the financial markets will be more forgiving to you?
Whatever your worldview, the market will likely continue to support it via gains and losses. Hard work and charisma both contribute to financial success, but losers in other areas of life are more likely to lose money in trading. If this sounds like you, don’t be alarmed. Instead, go the self-help way and discover how money and self-worth are related.
How to become a stock trader
If you’re thinking about working in the stock trading industry, you should be well-versed in the stock market and able to maximize your clients’ assets. To purchase and sell stocks for their clients, you will also need to pass an exam and receive a license. To start your career in this profession, adhere to these procedures.
Earn a degree.
Complete an internship.
Decide what you want to do.
Take the appropriate exams for your path.
Create a resume.
Search for open positions.
Prepare for your interview.
Gain additional experience and licenses as a stock trader.
1. Earn a degree
A degree in accounting or finance can provide you with useful abilities you can put to use in the stock trading industry. Some businesses will provide you with comprehensive training courses in which you will discover the fundamentals of buying and selling stocks.
2. Complete an internship
Consider doing an internship if you want to work as a stock trader and are a college student. You will see the requirements of the work through this learning experience. Additionally, an internship will show you how brisk stock trading can be and teach you how to purchase and sell at the right periods.
3. Decide what you want to do
Depending on what you want to accomplish, there are many distinct careers within the stock trading industry, each requiring a different level of training and licensing. You can decide what specific training or certifications you will require once you have chosen a career.
4. Take the appropriate exams for your path
Before you may become a stock trader, you must pass a specific exam and obtain a certain license. Several of these licenses consist of:
Series 7 general security sales license: permits traders to sell the majority of securities
Series 3 exam: enables trading in future commodity contracts
Series 63 license: ensures that the license holder is fully aware of the state’s securities sales legislation
Series 8 license: enables stock brokers to control and coordinate branch operations
5. Create a resume
When you apply for jobs, make an excellent resume that will get you noticed. Your CV should be crystal clear, succinct, and emphasize your most current education and skill set. When you begin looking for jobs, you should also write a tailored cover letter specifically for that post. Your cover letter can help your future employer have a deeper knowledge of your qualifications, which may help you stand out from other applicants.
6. Search for open positions
Start your employment hunt on job boards online. Most of them let you narrow down your search by state and city. Additionally, you can locate excellent career guidance and instructions on how to land a job. Newspapers, social media, as well as relatives and friends, are additional sources. When you locate a job that interests you, apply right away and follow up with the hiring manager a few days later.
7. Prepare for your interview
A prospective employer will get in touch with you for an interview if they believe your talents and experience match what they’re seeking for. To better prepare for your interview, do some research on the company’s industry and working environment. Be sure to send the interviewer a thank-you note following the interview to express your appreciation for the chance to learn more about the position.
8. Gain additional experience and licenses as a stock trader
To optimize your potential for improvement, keep in mind to take advantage of possibilities for lifelong learning. Attend any additional training sessions or courses that your employer offers to stay current on developments in your industry. By doing this, you can ensure that you advance as rapidly as possible and boost your confidence in your industry.
Sensex was intended to stand for the Bombay Stock Exchange’s 30 firms’ most popular market index.
Some of the largest corporations in this nation with the most actively traded equities are among the component companies listed in this index today.
The S&P BSE Index Committee chooses the companies that will be included under it based on the following five criteria:
Companies must be listed on the Indian Bombay Stock Exchange.
It has to be made up of big- or mega-cap stocks.
It must be mostly liquid.
It must make money from its core operations.
To keep the sector in balance with the nation’s equity market, businesses must participate.
It has had remarkable expansion ever since it first opened in the 1990s, particularly after 2000. For instance, information technology firms contributed to the index’s first crossing of the 6000 threshold in 2002. The significant rise in India’s Gross Domestic Product (GDP) since the turn of the century is responsible for this growth curve.
Axis Bank, Asian Paints, Bajaj Finance, Bharti Airtel, Coal India, HCL Technologies, Hindustan Unilever, ICICI Bank, IndusInd Bank, Tata Consultancy Services, Larsen & Toubro, and others are a few of the businesses included in this index.
Who owns Sensex?
Foundation
1 January 1986
Operator
ASIA INDEX Pvt.Ltd.
Exchanges
BSE
Trading symbol
^BSESN
What is the Full Form of Sensex?
Stock Exchange Sensitive Index is the official name of SENSEX. SENSEX, previously known as BSE (Bombay Stock market), is the oldest stock market in India. It is a free-floating, economy-weighted index made up of 30 very reputable, financially stable companies that are listed on the BSE. In India, these businesses are also known as Blue chip corporations. The 30 component companies, which are among the most prosperous and actively traded equities in India, represent a variety of industries.
How Does the Sensex Work?
The 30 largest and most liquid public firms in India make up the S&P BSE Sensex index, also known as the Sensex or Sensex Index. The Bombay Stock Exchange, the biggest in India and one of the biggest in the world, is where the firms that make up the Sensex are chosen from. The Sensex is widely used by investors throughout the globe as a gauge of the overall health of the Indian economy, which has experienced rapid expansion in recent years.
How is Sensex Calculated?
To guarantee that it accurately reflects the state of the stock market, BSE periodically adjusts the share composition of the Sensex. The index was first determined using a weighted method of market capitalization.
But this computation approach has been updated since 2003 and now incorporates a free-float capitalization method.
This free-float technique is an alternative to the market-capitalization method in which the index is calculated using the number of shares available for sale under a corporation rather than the number of outstanding shares. Thus, restricted stocks (those held by corporate insiders) that are not for sale are not included in this strategy.
The ratio of issued shares to outstanding shares is this factor. The index level constantly represents the free-float value of the 30 listed firms under the Sensex, relative to a base period, in accordance with this free-float capitalization technique.
How To Invest In Sensex?
The essential actions to take before beginning your investment in the Sensex are as follows:
Opening a Demat Account
It is crucial to have a Demataccount where your shares are stored electronically.
Open a Trading Account
You should register to start a trading account after opening a Demat account. Since the BSE does not permit the sale or purchase of securities directly. A trading account makes it simple to buy and sell assets online.
Having a Bank Account
To trade on the Sensex, an investor needs a bank account, a PAN card, in addition to a Demat and trading account.
Sensex 30 Companies: Their Weightage in The Index [2023]
SL
WEIGHT(%)
Name
Industry
Price
Mcap Full (Cr.)
M.Cap FF (Cr.)
1
11.95
RIL
Integrated Oil & Gas
2555.95
16,51,687.33
8,25,843.67
2
10.38
HDFC Bank
Banks
1508.6
9,07,505.07
7,16,929.00
3
9.37
ICICI Bank
Banks
908.35
6,47,532.81
6,47,532.81
4
7.1
HDFC
Personal Products
2497.25
4,95,541.41
4,90,586.00
5
6.5
Infosys
IT Consulting & Software
1530.5
5,22,358.84
4,49,228.60
6
5.48
ITC
Cigarettes,Tobacco Products
353.75
5,32,975.54
3,78,412.63
7
4.79
TCS
IT Consulting & Software
3207.15
11,82,184.61
3,31,011.69
8
4.16
L&T
Construction & Engineering
2006.9
3,34,188.53
2,87,402.13
9
4.1
Kotak Mahindra Bank
Banks
1899.85
3,83,077.64
2,83,477.45
10
3.43
Axis Bank
Banks
863.95
2,66,196.52
2,36,914.90
11
3.23
HUL
Housing Finance
2546.35
5,87,632.77
2,23,300.45
12
3.2
SBI
Banks
584.8
5,14,370.01
2,21,179.10
13
2.8
Bharti Airtel
Telecom Services
818.4
4,39,153.22
1,93,227.42
14
2.46
Bajaj Finance
Holding Companies
7121.6
3,86,764.29
1,70,176.29
15
1.97
Asian Paints
Furniture,Furnishing,Paints
3140.5
2,88,900.78
1,35,783.37
16
1.72
Maruti Suzuki India
Cars & Utility Vehicles
9236.35
2,69,671.40
1,18,655.42
17
1.68
M&M
Cars & Utility Vehicles
1335.7
1,50,777.87
1,16,098.96
18
1.65
Titan Co
Other Apparels & Accessories
2763.25
2,42,805.08
1,14,118.39
19
1.62
HCL Tech
IT Consulting & Software
1044.8
2,86,413.78
1,11,701.38
20
1.52
Sun Pharma
Pharmaceuticals
1044
2,32,838.00
1,04,777.10
21
1.27
UltraTech Cement
Cement & Cement Products
6727.55
2,20,195.51
88,078.20
22
1.27
Tata Steel
Iron & Steel/Interm.Products
102.2
1,32,769.30
87,627.74
23
1.2
NTPC
Electric Utilities
178.15
1,68,915.92
82,768.80
24
1.19
Power Grid
Electric Utilities
228.05
1,68,073.54
82,356.03
25
1.19
Bajaj Finserv
Finance (including NBFCs)
1723.25
2,16,551.23
82,289.47
26
1.14
Nestle India
Packaged Foods
20418.8
2,12,197.97
78,513.25
27
1.01
IndusInd Bank
Banks
1148.15
83,335.02
70,001.42
28
0.94
Tech Mahindra
IT Consulting & Software
1052.95
1,01,006.06
64,643.88
29
0.87
Dr Reddy’s Labs
Pharmaceuticals
4592.35
82,209.14
60,012.67
30
0.81
Wipro
IT Consulting & Software
388.65
2,08,272.64
56,233.61
What is S&P BSE Sensex?
It serves as a leading indicator of the Indian economy. This index contains 30 stocks with a number. These 30 businesses are the biggest and most liquid in their respective industries. They are authentic representatives of their sector or business because of their size and trading volume. Companies from a variety of industries and areas are also included in the index. The index, like the Sensex, is able to reflect the economy’s progress thanks to this diversity of businesses.
S&P BSE Sensex’s base yearis 1978-1979. Sensex debuted on January 1, 1986.
Sector/Industry Weightage in Sensex
Currently, 18 sectors (industries) are represented by the Sensex 30 businesses. The list of industries this bellwether index covers is provided below. Each sector’s weight is also mentioned.
The index is heavily weighted towards the banking industry, with IT and Oil & Gas following closely behind.
A big, well-known corporation is considered a Blue chip stock. These are often big, established, financially strong businesses that have been around for a while, have consistent earnings, and frequently distribute dividends to investors. A blue chip stock often has a market valuation of billions, is frequently a household name, and is either the market leader or among the top three corporations in its industry. Blue chip stocks are among the most often purchased by investors due to all of these factors. Blue chip companies include Boeing Co., Coca-Cola Co., and IBM Corp.
Although a blue-chip stock has no official definition, these businesses are renowned for their worth, stability, and longevity. Investors rely on them for their dependability because they are frequently household names in their respective businesses and huge names in general.
Understanding a Blue Chip Stock
Although paying dividends is not a requirement for a stock to be categorized as a blue chip, most blue chips have a lengthy history of paying constant or increasing dividends. The phrase is thought to have originated from poker, where blue chips are the priciest ones.
There is disagreement over the size requirement for a company to be considered a blue chip. Although businesses of all sizes can be market or sector leaders, a market capitalization of $5 billion is a universally recognized benchmark. Although the median market cap of the fund’s holdings has typically ranged in the vicinity of $100 billion, the T. Rowe Price Blue Chip Growth Fund does not have any specific criteria for what type of company qualifies aside from focusing on large-cap and mid-cap companies that are well-established in their industries.
The Safety of Blue Chip Stocks
Even though a blue chip firm might be seen as a secure investment because it has endured numerous difficulties and market cycles, this may not always be the case. Even the strongest businesses can struggle under extremely stressful circumstances, as evidenced by the 2008 global recession’s failure of General Motors, Lehman Brothers, and several other major European banks.
What makes a stock a blue chip?
An investment you might bring home to meet your parents is a blue-chip stock: It makes a favorable first impression and is supported by solid arguments. It is steady, responsible, and trustworthy.
The stocks of blue-chip businesses have a track record of strong performance in both good and poor economic conditions. The following characteristics are typically shared by stocks that are categorized as blue-chip stocks.
Large market capitalization
Market capitalization is a gauge of a company’s size and worth. Large-cap companies, or stocks with a market value of $10 billion or more, are frequently blue-chip stocks.
Growth history
Blue-chip companies have a dependable history of consistent growth and promising futures. They might not be as eye-catching as rapidly expanding tech stocks, but that’s because they’ve already made their mark.
Component of a market index
Major market indices like the S&P 500, S&P 100, Dow Jones Industrial Average, and/or Nasdaq 100 include blue-chip stocks as constituents.
Dividends
Blue-chip stocks don’t always pay dividends, but many do. Dividends are periodical payments made from a company’s earnings to investors. Companies that issue dividends are frequently mature, thus they might not need to reinvest as much money in their expansion.
Why invest in blue-chip stocks
Your portfolio shouldn’t be dominated by any one kind of stocks. Even if you invest in businesses that are generally regarded as being rock-solid, diversification is still important in the investment process.
Spreading your money across several company kinds is necessary for diversification. This entails taking into account businesses with small, midsize, and big market capitalizations, as well as firms from different sectors and regions.
However, because of their dependability, blue-chip stocks are well-liked by investors, particularly older or more risk-averse investors. They are not immune to market downturns, but they have a track record of surviving them and coming out on the other side.
Investors value blue-chip businesses’ normal dividend payments as well. If you’re investing for income, as many investors do in retirement, dividends are particularly alluring. Blue-chip stocks often offer consistent, rising dividends.
List of blue-chip stocks
Blue-chip stocks are typically well-known, although not always, as was said above. Here is a list of blue-chip stocks that you may be familiar with. Please take note that this list just serves as a sample and does not contain every blue-chip stock.
The straightforward reply is “YES.” But You must realize that stock market investment is a marathon, not a sprint. When compared to short-term investments, long-term investments will always provide the best returns. Buy and Hold Investment Strategies are overly effective for blue-chip businesses with strong earnings growth. In such businesses, the compounding effect is plain to detect.
If you are knowledgeable about the stock market, you can quickly identify fundamentally sound and technically sound businesses that will outperform the index in terms of return. The stock market can make you wealthy and increase your wealth. Many people have amassed enormous fortune for themselves, and many more have seen their money go in the stock market.
Since being wealthy requires patience, one needs to make consistent investments over an extended period of time. People who lack patience cannot succeed in the stock market. Investing in stocks might result in the creation of a second source of income. You can be an investor even if you work somewhere else in the world.
The fact that investing in stocks is based on the power of compounding is its finest feature. A long-term market participant generates greater wealth than a market outsider. You benefit from dividend stocks when you are going through a difficult time in your life.
Why invest in stock market?
An essential component of the Indian economy is the stock market. It offers the possibility for investors to profit from stock price fluctuations. It’s a fantastic opportunity to experience a range of businesses while being secure. Selling your shares for more money than you paid for them will allow you to profit.
There are various reasons why people invest in the stock market. Some people wish to put some of their money in the stock market because they think it will always go up. Some people just like the concept of investing and earning money without having to worry about equities.
Investing in the stock market is a fantastic opportunity to put your money to work and earn some extra money, regardless of your motivation. If you are just getting started investing in stocks and have a basic understanding of the stock market, you can start with mutual funds like debt funds, multi-cap funds, and index funds. However, if you have years of stock investing knowledge, you can build your own portfolio by conducting thorough research.
Key takeaways:
A person who owns shares in a company is making an investment in the future of that firm, therefore doing so entails putting their time and money into the business in the hopes of getting a return.
You own a portion of the ownership of a firm when you own shares in it.
Long-term high profits can be expected from investing in the stock market.
Benefits Of Investing In Stocks
Many investors over the years, whether novice or seasoned, have made considerable profits by strategizing and investing in equities. The fact that some investors’ success formulas didn’t work at all, however, causes everyone to pause before investing in stocks or entering the stock market. There are greater chances of profiting from investments when an investor makes the right and proper judgments.
The stock market is, after all, incredibly volatile. But compared to other investments, stock investing has a number of significant advantages.
Smooth and Continuous Transactions
When an investor purchases stock in a specific company, they are essentially acquiring a share in that business. As a result, after buying stocks, it will provide the investors a sense of ownership.
Having ownership entitles them to shareholder status and a significant voice in corporate decisions. Additionally, investors will have a voice in corporate choices. Additionally, they get yearly learning reports that provide them with in-depth information on the business. Owning stock in a specific firm is a means for investors to show their support for that business and its overall success.
Diversification
Diversification offered by stock market investments offers significant benefits to investors who spend their hard-earned money in several investment kinds. Independently from other assets like bonds and real estate, stock market investments experience value changes.
An investor will be better able to predict losses on other investment items if they hold stocks for a longer time. By increasing risk and generating significant gains quickly, adding stocks to a portfolio, investors can avoid overly conservative investment techniques.
Dividend Benefits
A dividend is a payment made by a firm to its stockholders. In layman’s terms, it is a yearly additional revenue that every company pays to investors. The dividend payments will be made whether the stock has lost value or still represents a profit from the shares.
Dividend income can assist a shareholder in funding their retirement or adding to their portfolio over time by paying for other investments.
Investment Gains
The opportunity to increase one’s income is one of the main advantages of stock market investing. The values of a specific stock may increase or decrease over time if the value of the stock market increases.
But those that invested in dependable businesses will experience an increase in profits. Similar to this, buying a variety of stocks would enable investors to increase their wealth by capitalizing on profitable sector-specific growth.
Liquidity
Because they can be quickly turned into cash that has multiple purchasers at any one time, stocks are commonly characterized as liquid assets. Finding a buyer for some assets, like real estate, is more challenging when compared to other assets.
However, it is considerably simpler when it comes to equities because of the high daily average volume of transactions on the NSE and BSE. It indicates that numerous buyers and sellers are keeping an eye on a particular stock.
Higher Returns over the Short Term
The biggest and most important benefit of investing in stocks is that, when compared to other investment options like bank FDs, it has the potential to provide high returns in a short amount of time.
They are well protected by SEBI
The Stock Exchange Board of India (SEBI) oversees the Indian stock market. The Security Board Exchange of India (SEBI) is in charge of overseeing the development of stock exchanges as well as safeguarding the interests of all investors.
A regulatory framework established by SEBI safeguards an investor’s interests when they invest in a variety of financial instruments on the stock market. This aids them in lowering the dangers of various corporate fraud schemes.
Flexibility To Invest in Smaller Amounts
When an investor first decides to invest in the stock market, they might do so by buying stocks in smaller units from small- or mid-cap corporations.
Another significant benefit of investing directly in stocks is that investors can make their own purchasing decisions and are not required to make a certain monthly investment.
It Allows You To Take Advantage Of The Growing Economy
Corporate profits typically tend to rise in tandem with economic expansion. This is typically caused by a number of causes, such as increasing job generation, which raises income and sales. Therefore, an investor who invests in the stocks of the companies whose growth is driven by the economy aids in their improvement.
Easy Process of Buying and Selling
All investors can easily and simply buy and sell stocks on the stock market. Stock purchases can be made online, through a financial counselor, or through a broker. Just a few minutes are needed to create an account and begin trading. A trader can easily purchase and sell stocks online, and the proceeds are immediately credited to their bank account.
To operate, every company needs money. Sometimes the revenue generated by selling goods or services is insufficient to cover the costs of working capital. In order to run their business effectively, firms encourage regular people like you and me to participate in it. In exchange, investors receive a piece of the company’s profits.
Understanding this is the first step in learning the fundamentals of the stock market. Let’s investigate this in greater detail.
What are Stocks?
Stocks are just one investing strategy for increasing wealth. Purchasing shares in a firm entitles you to ownership of that company’s common stock.
One option to invest in some of the most prosperous businesses is through stock investments.
Additionally, there are several stock types available on the market for trading or investing. Based on the following characteristics, these stocks are categorised:
Market capitalization
Ownership
Fundamentals
Price votality
Profit sharing
Economic trends
How Does the Stock Market Work?
Companies offer ownership holdings to investors in order to raise capital on the stock market. Shares of stock are the name for these equity investments.
Companies can get the money they need to run and grow their operations without taking on debt by listing shares for sale on the stock exchanges that make up the stock market. By swapping their funds for shares on the stock market, investors gain.
As businesses use that money to develop and expand, investors profit because their stock shares appreciate in value over time, resulting in capital gains. As their revenues increase, businesses also distribute dividends to their shareholders.
Individual stock performance over time varies greatly, but the stock market as a whole historically has given investors average annual returns of about 10%, making it one of the most dependable methods to increase your money.
Stock Market Basics – Important Terms
The terminologies that are frequently used when discussing the stock market are listed below. This can serve as a vocabulary that you can consult whenever you wish to learn.
Securities and Exchange Board of India (Sebi) is the securities market regulator to oversee any fraudulent transactions and activities made by any of the parties: companies, investors, traders, brokers and the likes.
Demat
Demat, or dematerialised account, is a form of an online portfolio that holds a customer’s shares and other securities in an electronic (dematerialised) format.
Trading
It is the process of buying or selling of shares in a company.
Stock Index
A stock index or stock market index is a statistical source that measures financial market fluctuations. They are performance indicators that indicate the performance of a certain market segment or the market as a whole.
Portfolio
It is a collection of a wide range of assets that are owned by investors. Portfolio can also include valuables ranging from gold, stocks, funds, derivatives, property, cash equivalents, bonds, etc.
Bull Market
In a bull market, companies tend to generate more revenue, and as the economy grows, consumers are more likely to spend.
Bear Market
Bear markets refers to a slowdown in the economy, which may make consumers less likely to spend and, in turn, lower the GDP.
Nifty50
Nifty 50 is a collection of the top 50 companies listed on National Stock Exchange (NSE).
Stock Market Broker
A stock broker is an investment advisor who execute transactions such as the buying and selling of stocks on behalf of their clients.
Bid Price
Bid price is the highest price a buyer will pay to buy a specified number of shares of a stock at any given time.
Ask Price
Ask price in stock market refers to the lowest price at which a seller will sell the stock.
Initial Public Offer (IPO) is the selling of securities to the public in the primary market. It is the largest source of funds with long or indefinite maturity for the company.
Equity
Equity is the value that would be received by the shareholder if all of the company’s assets were liquidated and all of the company’s debts were paid off.
Dividend
Dividend refers to cash or reward that a company provides to its shareholders. It can be issued in various forms, such as cash payment, stocks or any other form.
Bombay Stock Exchange (BSE) is the largest and first securities exchange market in India. It was established in 1875 as the Native Share and Stock Brokers’ Association. It is also the first stock exchange in India and provides an equities trading platform for small-and-medium enterprises.
National Stock Exchange was the first to implement screen-based or electronic trading in India. It is the fourth largest stock exchange in the world in terms of equity trading volume as per the World Federation of Exchanges (WFE).
Types of Stock Market?
There are 2 types of stock market:
1.Primary Market: It serves as a venue for companies to list new stock options and bonds for purchase by the general public while also creating securities.
2.Secondary Market: With the aid of brokers, investors trade securities here without involving the original corporations that issued them.
Rules of Investment:
1.Invest early
2.Invest regularly
3.Invest for long term and not for short term
Therefore, the investor should always be mindful of these guidelines while making investments—not just in the stock market but also in other types of investments.
How to Tackle risk involved in Stock Market?
It has been observed that the average individual is not willing to engage in the stock market because of the risk involved; they believe that their hard-earned money would be lost in the market as a result of market fluctuations.
However, the only way to handle the situation is for a person to invest their money in a diversified portfolio, which means they shouldn’t put all of their money into a single security but rather spread it across a variety of securities so that any losses from one security are offset by gains from other securities.
A balanced fund is a very good product on the market that invests a proportionate amount of capital in risky assets (stocks and shares) and the remaining capital in safe assets (debt securities). The percentage of this investment is chosen in such a way that the investor seldom experiences any loss.
Key Financial Instruments To Trade In The Stock Market
Bonds
Shares
Derivatives
Mutual Fund
1.Bonds
For projects, businesses require money. The money they have made from the enterprise is then used to repay them. Bonds are one method of raising money. A loan is what a business obtains from a bank in exchange for recurrent interest payments. Similar to this, a bond is what a business issues when it borrows money from numerous investors in return for periodic interest payments.
Consider starting a project that will begin to generate revenue in two years. You will require an initial sum of money to start the project. You borrow the money from a buddy and then write on the receipt, “I owe you Rs. 1 lakh and will repay you the principal loan amount by five years, and I will pay a 5% interest per year until then.” If your acquaintance is holding this receipt, it signifies he recently purchased a bond by making a loan to your business. You commit to paying the 5% interest each year at the end and the Rs. 1 lakh principal at the end of the fifth year.
Consequently, a bond is a way to invest money by making loans to other people. It is called a debt instrument for this reason. When investing in bonds, you will see the face value, which is the amount of money being borrowed, the coupon rate or yield, which is the interest rate the borrower must pay, the coupon payments, and the maturity date, which is the date by which the money must be repaid.
2.Shares
Consequently, a bond is a way to invest money by making loans to other people. It is called a debt instrument for this reason. When investing in bonds, you will see the face value, which is the amount of money being borrowed, the coupon rate or yield, which is the interest rate the borrower must pay, the coupon payments, and the maturity date, which is the date by which the money must be repaid.
You just agreed to pay your brother Rs 50,000 to sell him half of your business. You document this deal in writing: “One hundred shares of stock will be issued by my new company.” For Rs. 50,000, my brother will purchase 50 shares. As a result, your brother recently purchased 50% of the stock in your company. He currently owns shares. Let’s say your brother requires Rs 50,000 right away. He can get the money by selling the stake on the secondary market. Given that the share price could change, this could be greater than or less than Rs 50,000. It is viewed as a riskier instrument as a result.
Thus, shares serve as a record of a corporation’s ownership. As a result, as a stockholder, you share in both potential profits and potential losses that the firm may experience. Your equities’ value will rise if the business performs better, increasing the return on your investment.
3.Mutual Funds
These are financial entities that let you make covert investments in bonds or the stock market. It collects funds from a number of investors and invests the whole amount in financial instruments. The professional fund manager is in charge of this.
Every scheme issues units, each of which has a fixed value similar to a share. This means that when you invest, you become a unit-holder. As a unit holder, your investment’s value rises when the securities in which the MF scheme invests gain money.
Either the value of the units increases, or money is distributed to all unit holders in the form of dividends.
4.Derivatives
Financial instruments like shares constantly fluctuate in value. Therefore, it is challenging to set a certain price. Here, derivatives instruments are useful. These are tools that enable you to trade in the future at a fixed price today. You just engage into a contract to purchase or sell a share or other financial instrument at a predetermined set price.
A stock, usually referred to as equity, is a type of investment that denotes ownership in a portion of the issuing company. The “shares” that make up a unit of stock entitle the owner to a piece of the corporation’s assets and income proportional to the number of shares they possess.
Most individual investors’ portfolios are built on stocks, which are mostly bought and sold on stock exchanges. Government standards designed to shield investors from dishonest tactics must be followed during stock trades.
Where to You Buy Stock?
Stocks are often listed and traded on exchanges, authorized locations where buyers and sellers can connect, frequently with the help of a broker or other intermediary. These middlemen will be exchange participants, and they will utilize their access to the market to buy and sell shares on your behalf. The New York Stock Exchange(NYSE) and the Nasdaq market are two significant exchanges in the United States.
Alternately, smaller companies with less liquid shares and modest market caps (often referred to as penny stocks) may trade over-the-counter(OTC) on less tightly regulated marketplaces like the OTC Pink Sheets. Investors who choose to trade on the OTC market should conduct more due diligence and comprehend the risks associated because the shares of these companies are frequently more volatile and dangerous.
What are the different types of stock to invest in?
1.Common stock
When you consider investing in stocks, you generally first consider common stock. By purchasing common stock, you have an ownership stake in the firm and the right to vote on important decisions like the election of the board of directors or the adoption of specific corporate policies.
2.Preferred stock
The class of financial instruments known as “preferred” includes preferred stocks, also known as “preferred.” They are a hybrid between stocks and bonds due to their unique properties. Although they are debt instruments in many ways, they are technically equity securities.
3.Large-cap stock
Due to the size of the common stock universe, one method of segmenting it is by categorizing businesses according to their market capitalization, or the sum of the value of all their outstanding shares. Although there isn’t a precise definition of a large-cap stock, it typically refers to firms having market capitalization of $10 billion or more. The greatest large-cap stocks are commonly referred to as blue-chip stocks since they are typically comprised of well-established businesses with track records of profitability.
4.Mid-cap stock
The next market cap level down is mid-cap stocks, with these businesses typically valued between $2 billion and $10 billion. Even if these businesses are well-established, they may still be in the early stages of development and have the potential for significant price increase. Before reaching new heights, a lot of the large-cap companies of today were formerly mid-cap stocks.
5.Small-cap stock
A publicly traded company with a market capitalization between $300 million and about $2 billion is considered to be a small-cap stock. The market capitalization of a corporation is referred to by the word “cap” in this phrase.
Small, mid, and large-cap corporations are categorized subjectively, and brokerages and market analysts may have different definitions.
6.Growth stock
One of the most intriguing segments of the stock market is growth stocks, but it’s not as easy as the name would imply to purchase them and generate significant returns. Because investing in high-growth companies can be tremendously lucrative, their prices occasionally get bid up to excessive heights where investors won’t receive adequate returns. However, if you can buy a growth company at a tempting price, you could be able to benefit from its performance for a very long time.
How do I start investing in the stock market as a beginner?
1. Open a Trading and Demat Account
You require both a trading account and a demat account in order to purchase and sell shares. You can make orders to purchase or sell shares using a trading account. The shares you purchase are kept in an online account called a demat account. Any SEBI-registered broker is able to setup a trading account and a demat account for you. Even if you don’t have to open both with the same broker, having a trading account and a demat account with the same brokerage firm makes trading easier. A 3-in-1 account, offered by some brokers, allows customers to open a bank account in addition to a trading and demat account.
2. Decide how you want to invest
You can choose the stocks you want to buy yourself or you can use expert services to do it for you. Through your trading and demat accounts, you can invest in stocks if you think you have the time to perform the necessary research. You have the option of investing in the stocks in a portfolio put together by professionals. Under the heading of One Click Portfolio, ICICIdirect provides a number of similar portfolios with various investment goals. Then, you can use your trading account to purchase these shares. Alternative investment options include equity mutual funds.
3. Pick the stocks you want to invest in
If you are investing on your own, you must design your portfolio and pick the equities you wish to buy. Choosing stocks with a proven track record of strong performance is a solid place to start. Companies that are a part of well-known indices, like the Sensex or NIFTY, are typically solid choices for beginners. Even you start out with index ETFs when you begin investing. ETFs seek to produce portfolios with returns that are comparable to those of Indexes. As you gain knowledge of the stock market, you can invest in more businesses and build a portfolio that matches your financial goals and risk tolerance.
4. Keep adding to your portfolio
You must invest consistently if you want to have a solid portfolio that can assist you in reaching your long-term financial objectives. Over time, increase your stock investments and keep expanding your portfolio. A portfolio comprising stocks from many industries is beneficially diversified. Nevertheless, be careful not to over-diversify. The greatest equities to buy are those of 10–12 reliable corporations. You have the option to invest in equities on a recurring basis using a Systematic Equity Plan (SEP), which is akin to a mutual fund’s SIP.
5. Monitor your portfolio
Spend some time periodically checking on your portfolio. Watch to see if the stock performance matches your expectations. If any business is continuously functioning poorly, think about switching to a different business. You may monitor your portfolio to make sure that your investments are doing well and expanding at the rate you anticipate.
