Learn · Equity & Markets · Part 1 of 4 · 4 min read
A share of a company is a small, real slice of ownership in that business — not a betting slip, not an abstract number on a screen. If a company has 1 crore shares outstanding and you own 100 of them, you own 0.0001% of that company: its factories, its brand, its future profits, and its future losses, proportionally.
This matters because it means a share's value is ultimately tied to something real — how much money that business makes, and how much of that money it's expected to make in the future. Everything else in this series builds on that one fact.
India has two major stock exchanges — the NSE (National Stock Exchange) and the BSE (Bombay Stock Exchange). Neither is a government office, and neither "sets" prices. An exchange is essentially a giant, continuous matching engine: it takes buy orders and sell orders from millions of participants and matches them at whatever price both sides agree on.
When you place an order to buy a share at ₹500, the exchange looks for someone willing to sell at ₹500 (or lower) and executes the trade instantly. The "price" you see quoted at any moment is simply the most recent price at which a real buyer and a real seller agreed to trade.
A share's price moves when the balance between buyers and sellers shifts — which itself is driven by:
None of this requires any single entity to "decide" a price — it emerges from the aggregate of everyone trading at once.
You'll constantly hear "the market is up" or "the market fell today" — this almost always refers to a specific index, like the Nifty 50 or Sensex, not literally every single stock. An index is a defined basket of specific stocks, combined using a specific formula, into one headline number.
That number can move very differently from how the "average" stock is doing — a handful of large companies can drag an index up or down while most smaller stocks do something else entirely. Understanding exactly how an index like the Nifty 50 is built is the next piece in this series.