Investing In India Understanding the stock market in India

India is a growing economy and it is the time to start looking into the Indian economy as it is believed that India will be the largest youth population very soon. With the global trade issues with China, India is the next most sought after place to move your manufacturing, production and RnD to. Already companies like Mercedes Benz, Apple, Google and many other big companies are already making this move. 

Talking about investment, as common citizen, learning stock market is the first step towards making an investment in a growing publicly listed company.
  • Only 2% of India population is participating in stock market
  • Stock market has to be learned before start doing it. Or there is a big chance to lose your money.
Below are the basic participants of India's stock market scenario.

Participants of Stock market in India

  • SEBI
  • Public listed companies
  • Brokers
  • Investors
  • Clearing House, Transfer Agent, settlement banks, Depository, Depository participants
Valuation of a business is number of shares x value of each share. Current valuation of the company will be divided into number of shares and certain number of shares will be given in exchange of investment.

What is a public listed company and IPO?

When companies require further funds for expansion of business. They go to the stock market and sell shares there in return of investment from public. When the first time a company does this, that process is called Initial public offering(IPO). IPO is a complex and detailed business process which is regulated by SEBI. SEBI is the big brother who governs all the stock market scenario in India.


In a stock market perspective, an investor is a person who invest in a public company by buying shares from a share broker platform. Investors are part owners of a company. They are eligible for a profit dividend. An investor is entitled to buy more shares from the market or can sell the shares in the market once the company is grown and share price risen.

Fundamental analysis : Fundamental analysis of a company is a study of the company before making an invest into any company. Another type of study you may do us the technical analysis.

The stock price varies depends on the company growth/performance and market sentiments. The stock value we see generally on TV or an app interface is the last sold price(LTP)


No investor can directly approach stock market and buy shares of an public company. Buying and selling is generally facilitated through brokers. Brokers are licensed by SEBI to act as middlemen between an Investor and the other internal components of stock market.

Trading and DEMAT accounts

When the share trading in stock market got digitized with the rise of technology, a de materialized account is introduced in market to buy and sell digital shares. A demat account is the account where you keep your digital shares. Where the trading account is used to keep the money to be spent or earned from stock market is stored. You will be having a savings account to keep your money -> whenever required you can keep some money in the trading account to buy shares to the demat account.