Market capitalisation (market cap) is the total market value of a company's outstanding shares, calculated as the share price multiplied by the number of shares. It is the standard way to size a company: a firm's market cap, not its share price, tells you how large it really is.
The large, mid and small-cap bands in India
SEBI standardised these categories for mutual funds by ranking every listed company by market cap:
- Large-cap — the top 100 companies by market capitalisation.
- Mid-cap — the companies ranked 101st to 250th.
- Small-cap — every company ranked 251st and below.
The band matters because it is a rough guide to risk and behaviour. Large-caps tend to be more stable and liquid; small-caps can grow faster but usually carry higher volatility and wider price swings. Knowing the market-cap mix of your holdings is a core part of understanding how much risk your portfolio actually carries.