What is Equity Capital?

What is Equity Capital in Business ?

Equity capital is the money a company gets from selling its shares. When people buy shares, they own a part of the company and contribute to its funding.

To figure out equity capital market, you multiply the number of shares a company sells by the Face Value (FV) of each share. For example, if a company sells 1,000 shares at FV of INR 10 each, the equity capital is INR 10,000.

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Equity Capital Formula Calculator

Formula for the value of equity capital calculated by multiplying a company's share price by its number of shares.It shows how much money people have put into a company by buying its shares. This money helps the company grow and operate.

Why is Equity Capital Important 

  • Business Strength: It tells us about a company's financial health and how much it's worth.
  • Ownership: People who own shares have a say in the company's decisions.

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Equity Capital Examples:

Let's say Company name Anant Raj Ltd has 32.4 Cr shares trading in the market at Face Value of INR 2 each each. Their equity capital is INR 65 Cr.

Understanding equity capital helps investors know how much a company is worth and how financially strong it is.

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