01 October 2011
Dear Sir, How does a company determine the rate of share .
I want say that whenever we ask to any available resource about the rate of any company's share then we find some changes in rate of share. how does rate of share increase or decrease .
There are two stages in deciding the value of shares of a company in which you or me as individuals might be interested. One when company announces Initial public offer (IPO). This is when a company decides the value of share i.e the price at which it will be issued. You can do a google search with "Pricing of IPO" and you will get ample material of read on.
Second stage is when the company gets its shares listed on exchanges (like NSE or BSE in India). Listed shares get traded on exchange and thus their price keeps changing. These prices are decided by market forces of perception about the company's future. Do a google search with "Pricing of shares" or similar and again you will get tons of material to read on.
CAclubindia
