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August 17, 2010December 31, 2025

Mandatory 25% Free Float on Listed Companies

The amendment details, as promised by the Finance Minister, regarding the minimum public shareholding threshold of 25%, are outlined below.

The salient features of the amendment are as follows:

a) The minimum threshold level of public shareholding will be 25% for all listed companies.
b) Existing listed companies having less than 25% public shareholding are required to reach the minimum 25% level by an annual increase of not less than 5% in public shareholding.
c) For new listings, if the post-issue capital of the company calculated at the offer price is more than ₹4,000 crore, the company may be allowed to go public with 10% public shareholding and comply with the 25% public shareholding requirement by increasing public shareholding by at least 5% per annum.
d) Companies whose draft offer documents are pending with the Securities and Exchange Board of India on or before the notification of these amendments are required to comply with the 25% public shareholding requirement by increasing public shareholding by at least 5% per annum, irrespective of the post-issue capital size.
e) A company may increase its public shareholding by less than 5% in a year if such increase results in achieving the 25% public shareholding level in that year.
f) The requirement for continuous listing will be the same as the conditions applicable for initial listing.
g) Every listed company shall maintain public shareholding of at least 25%. If public shareholding falls below 25% at any time, the company must restore it to 25% within a maximum period of 12 months from the date of such fall.

Effects of mandatory 25% free float —

– Listed Indian companies will have a minimum free float of 25%, compared to the earlier minimum requirement of 10%.

– Companies with less than 25% free float will need to sell at least 5% of outstanding equity each year, achieving the mandated 25% level over a maximum period of three years.

– Companies planning to list may sell a minimum of 10% equity through IPOs if market capitalisation exceeds ₹4,000 crore, but must still increase free float to 25% within three years.

– Free float enhancement to 25% could lead to additional equity supply worth approximately USD 31 billion from existing listed companies.

– A further surge in equity supply could occur if large public sector undertakings such as Coal India and BSNL are listed.

– Some companies may witness upward re-rating, while others could face downward valuation pressure due to increased supply.

– Higher free float leading to improved liquidity and institutional interest may act as a positive catalyst for select stocks. Companies such as SAIL, Power Grid, and Power Finance Corporation may fall into this category.

SEBI’s mandatory 25% public shareholding rule increases market liquidity and transparency, impacting stock supply, valuations, and long-term investor participation.

Disclaimer

This content is provided for educational and informational purposes only and should not be construed as investment advice, research, or a recommendation to buy or sell any securities.
Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully.

August 17, 2010December 31, 2025

Investor Classroom…Investor Classroom…

Here is a useful resource — an Investor Classroom by Morningstar — designed for all types of investors, whether you are a beginner or an experienced investor.

The classroom covers a wide range of topics, including stocks, bonds, mutual funds, portfolio construction, and other core investment concepts. This learning resource is hosted on Morningstar’s US website; however, the fundamental principles and concepts are equally relevant for Indian investors.

It also explains important topics such as financial ratios, basic valuation concepts, and how investors can analyse investments more objectively.

You can access the classroom here:
http://www.morningstar.com/Cover/Classroom.html?t1=1173112294

Pretty useful.

Disclaimer

August 3, 2010December 31, 2025

Investing in Mutual Funds because they are less risky?

Most investors begin their investment journey using mutual funds.

I am often surprised when many people approach me for advice on investing in mutual funds rather than equities, primarily because they perceive equity-oriented mutual funds to be much safer than investing directly in stocks. If you believe this, think again.

This is an incorrect understanding.

Equity-oriented mutual funds are only as good (or as bad) as the investments made by the mutual fund manager and the underlying assets selected for the portfolio.

The risks and returns of equity mutual funds are directly linked to the fund’s holdings — that is, the underlying stocks, their performance, and the overall movement of the stock market. Returns and risks are also influenced by the fund manager’s ability to make investment decisions, including timing entry and exit, and generating alpha.

From Investopedia — Alpha is one of the key risk-adjusted performance measures used in modern portfolio theory. Simply stated, alpha represents the value that a portfolio manager adds to or subtracts from a fund’s return when compared to a benchmark.

If the stock market declines sharply or crashes, the Net Asset Value (NAV) of equity mutual funds also declines. Short-term performance of mutual funds is closely linked to market movements, while long-term performance depends on factors such as the fund’s objective, asset allocation, and the fund manager’s execution.

Therefore, if you wish to invest in mutual funds, you may certainly do so. However, it is important to remove the perception that equity mutual funds are inherently less risky than investing directly in stocks.

For investors with a savings-oriented mindset, a Systematic Investment Plan (SIP) in either quality stocks or mutual funds can help meet long-term return expectations through disciplined investing. Over extended periods, and after considering recurring mutual fund expenses, investing directly in stocks and holding them long term may even deliver comparable or higher outcomes in certain cases.

Conclusion

Whether investing in stocks or mutual funds, it is essential to stay informed about the sectors, businesses, and underlying fundamentals of your investments. A lack of understanding can lead to unpleasant surprises over time. Informed decision-making and long-term discipline remain critical to successful investing.

Equity mutual funds are not risk-free. Their performance depends on market movements, underlying stocks, and fund manager decisions. Understanding risk is essential before investing.

Disclaimer

July 27, 2010December 31, 2025

You can SIP in stocks The 10 Steps

SIP, or Systematic Investment Planning, is a concept. It simply means investing money at regular intervals. SIP helps inculcate financial discipline, removes emotional decision-making, and allows investors to participate in markets in a structured manner.

However, many people assume that SIPs are available only in mutual funds. Because of this assumption, they miss the true essence of what SIP actually represents. Mutual funds do offer automated SIP facilities through bank mandates, which makes the process convenient. However, SIP itself is not limited to mutual funds.

It is important to understand that SIP is a concept, not a product. This concept can also be applied while purchasing shares or equities directly. Yes, you can SIP in stocks.

There are many situations where SIP in equities may be considered, such as:
(a) You want to build your own stock portfolio with exposure to specific sectors
(b) You follow a buy-and-hold investment approach
(c) You are interested in investing in dividend-yielding stocks
(d) You prefer to avoid annual recurring AMC expenses, which actively managed mutual funds typically charge on portfolio value
(e) You want to invest in Exchange Traded Funds (ETFs)

There can be multiple reasons for choosing direct equity investing. Once you decide to invest in equities, you can structure your investment using a systematic investment approach.

10 Steps to SIP in Stocks:

Decide the interval (or frequency) at which you want to invest, for example, monthly on the 25th of every month.
Decide the periodic SIP amount you wish to invest, for example, ₹14,000 every month.
Use a calendar to set reminders. You may use digital tools like Google Calendar or any other reminder system so that you remember to allocate funds for investment on time.
Decide the asset classes you want to invest in, such as ETFs (for example, index or gold ETFs), individual stocks, or debt-oriented instruments like liquid ETFs for stability.
Decide the allocation amount for each asset, for example, ₹2,000 per investment.
Once the plan is in place, execute it with discipline. When you receive the reminder, proceed with the purchase as planned.
Conduct a periodic review, preferably every quarter, to assess performance and portfolio alignment.
Define a performance benchmark to evaluate your investments over time.
Measure performance against the benchmark and review outcomes periodically.
In addition to time-based SIPs, investors may also consider a price-based SIP approach. If a stock declines significantly between two planned purchases, an investor may choose to advance the purchase and skip the next scheduled installment for that stock.

For example, if you invest ₹2,000 in a stock at a certain price and the stock falls by more than 10% before your next planned purchase, you may choose to invest earlier and skip the following cycle for that stock.

There are several index ETFs available in the market that provide a low-cost alternative to actively managed funds and may be considered based on individual investment preferences.

Understanding your investor profile is essential. If you identify yourself as a disciplined, long-term saver, SIP in stocks can help you gradually build a portfolio. Over time, such a portfolio may generate income through dividends and potential capital appreciation, contributing to long-term wealth creation.

SIP in stocks allows investors to build a disciplined equity portfolio over time. Learn the step-by-step process to invest systematically in shares.

Disclaimer

July 22, 2010December 31, 2025

Mutual Funds – Be Aware of the Charges and Its Impact

Most investors begin their investment journey using mutual funds. I am often surprised when many people approach me seeking advice specifically for investing in mutual funds rather than equities. The surprise is not because I prefer investing in equities over mutual funds (which I do).

The real surprise lies in the perception. Many investors believe that investing in equity-oriented mutual funds is much safer than investing directly in equities. This is a misunderstanding.

Equity-oriented mutual funds are only as good (or as bad) as the investments made by the mutual fund manager. The risks and returns of a mutual fund are directly linked to:

The underlying stocks held by the fund
Overall stock market performance
The fund manager’s experience, strategy, and execution

Most mutual fund managers aim to beat the benchmark index, as this is how performance is measured. In the process, they attempt to time market entry and exit and outperform peer funds in the same category. Even experienced fund managers sometimes end up buying high and selling low.

Historically, it has been observed that around 80% of actively managed mutual funds underperform their benchmark indices over long periods of time.

If the stock market declines sharply or crashes, the Net Asset Value (NAV) of equity mutual funds also falls. During the market downturn from 2008 to March 2009, many mutual funds performed worse than their respective indices.

Most mutual funds have annual recurring costs, such as:

Asset Management Company (AMC) charges
Operational expenses
Marketing and distribution expenses

Entry load is no longer charged; however, some funds do levy exit loads. These expenses are deducted irrespective of the fund’s performance. Even if a fund underperforms, these charges continue to reduce your returns. Unfortunately, most investors do not pay sufficient attention to these recurring costs.

Several mutual funds have delivered poor performance over extended periods, and many New Fund Offers (NFOs) launched in recent years have significantly underperformed the broader markets.

It is important to understand the various expenses involved, such as:

Management fees
Administrative charges
Distribution fees

There are also indirect costs like brokerage costs, interest costs, and redemption-related expenses.

Another important aspect to be aware of is the turnover ratio. The turnover ratio indicates how frequently the fund’s holdings are bought and sold during a given period. A high turnover ratio suggests frequent trading, which can increase costs and impact returns. It also reflects how efficiently the fund’s cash is being utilised.

The objective of this post is to help investors become aware of these factors before investing in mutual funds. Typically, total expenses range between 1.5% and 2.5%, and over long investment horizons, these costs can significantly impact overall returns. Expense ratios vary across funds.

The Securities and Exchange Board of India (SEBI) has prescribed an upper limit on expense ratios:

Not more than 2.50% for equity mutual funds
Not more than 2.25% for debt mutual funds

A good mutual fund is one that delivers reasonable long-term returns with minimal expenses and ideally maintains a lower turnover ratio. Investors may refer to independent research platforms such as valueresearchonline.com or mutualfundsonline.com for further analysis.

Investors should also explore Index Funds and Exchange Traded Funds (ETFs). These funds aim to replicate the performance of an index rather than outperform it. As a result, they typically have lower costs compared to actively managed mutual funds.
A separate post on the overview of various types of mutual funds provides a visual understanding of the options available for investment.

Mutual fund charges like expense ratios and turnover costs can significantly impact long-term returns. Understanding these costs helps investors make informed decisions.

Disclaimer

July 20, 2010December 31, 2025

Live Your Purpose. Live Your Dreams. Never Give Up.

This powerful and inspiring video is a reminder that success is built on purpose, passion, and perseverance.
It carries a simple yet life-changing message — Don’t give up. Don’t quit. Stay determined. Stay decisive. Stay relentless.

When you live with focus and intention, every challenge becomes a stepping stone.
Be present in the moment. Trust your journey. Follow your passion.
Above all, live the life you were meant to live.

A video worth watching, reflecting on, and sharing with those who need motivation today.

Credit: Author – Edgevolution

July 12, 2010March 12, 2026

Aban Offshore Stock Analysis (July 2010): Price Fall & Recovery

Stock Watch – Aban Offshore (July 2010)

Sharp Price Movements in Aban Offshore

Aban Offshore Ltd has historically been known for sharp and volatile price movements, making it attractive for short-term traders. The stock often shows explosive movement in both directions, which creates trading opportunities but also increases risk.

During mid-May 2010, the stock witnessed a dramatic fall from around ₹1170 levels to nearly ₹650 in a very short span of time. The fall was swift and intense, reflecting panic in the market.

Reason Behind the Sharp Fall

The sudden decline in the stock price was triggered by news that one of the company’s offshore rigs had sunk in the Caribbean Sea. Such incidents typically create uncertainty around:

Insurance coverage
Operational disruption
Potential financial losses

As a result, investors reacted quickly and the stock corrected sharply.

Recovery Phase Begins

After the sharp fall, the stock began showing signs of stabilization around the ₹740 levels. Gradually, buying interest started returning to the stock.

Around three months later, the stock began another strong move upward with visible increase in trading volumes. The price moved above the ₹850 levels, indicating renewed confidence among traders.

Reason Behind the Upward Move

The recovery in the stock price was largely driven by positive news that:

The re-insurer would cover most of the claims related to the sunken rig.

This development significantly reduced concerns about the financial impact of the incident. For a company operating in offshore drilling, such insurance protection is typically expected before undertaking high-risk deep-sea operations.

Impact of Financial Results

Shortly after the news, the company announced its financial results. The results reflected a one-time write-off related to the sunken rig.

Markets had already factored in much of this information, which allowed the stock to continue its recovery without significant downside pressure.

Possible Technical Levels to Watch

From a technical perspective, traders were closely watching the possibility of the stock moving towards the gap zone around ₹1000 levels.

If the upward momentum continued with strong volumes, the stock had the potential to:

Reach the ₹1000 gap zone quickly, and
Possibly move higher in the following months.

Short-term traders often rely on trend lines, price-volume patterns, and probability-based setups to identify such opportunities.

Long-Term Investor Perspective

While traders may find volatility attractive, long-term investors have had a different experience.

Many investors who bought the stock during the 2007–2008 market cycle around ₹3000–₹4000 levels were still waiting for a meaningful recovery.

This highlights an important lesson in equity investing:

High volatility stocks can create trading opportunities
But they may also test the patience of long-term investors

Final Thoughts

Aban Offshore remains a high-beta stock where news flow, operational developments, and market sentiment can trigger sharp price movements.

For traders who closely track technical trends, price action, and volume patterns, it can be a stock worth watching. However, as always, risk management and disciplined trading strategies remain essential when dealing with highly volatile stocks.

July 1, 2010December 31, 2025

How do you start meditation?

Recently, I received an email from one of my best college friends after a long time. He reached out with a very specific purpose — he wanted to start meditation. Knowing that I have been meditating regularly for quite some time, he asked me a simple yet powerful question: How do you start meditation?

I was genuinely happy to help. Below is the email I wrote back to my friend, sharing my personal understanding and experience with meditation.

I meditate on a regular basis.
The idea of meditation is to train your mind to focus and to put your mind under observation.

(You can choose any subject to focus on. Some people focus on the power of the word “Om”. I prefer to focus on my breath, which is the source of life.)

By doing this, you essentially train the mind and strengthen its natural ability to focus. This training of the mind is similar to physical exercise. Just as you go to the gym to build muscles or biceps, meditation helps build mental strength, awareness, and discipline.

Over time, this practice helps you become aware of your breath at will. You naturally slow down, gain control over your thoughts, and develop the ability to focus your mind on any subject whenever required.

In the beginning, to form a habit, practise meditation with discipline for 21 consecutive days, for 15 minutes daily. Research suggests that it takes around 21 days to form a new habit, and meditation is no different.

How is meditation useful?

Whenever negative thoughts or emotions arise, meditation helps you become aware of them in that very moment. Once awareness develops, you gain the ability to consciously redirect your mind towards positive thoughts and emotions.

This process preserves your mental and emotional energy, allowing it to be used constructively. Meditation helps reduce negative emotions such as anger, pride, greed, and envy — emotions that drain energy and disturb mental peace.

I sincerely believe that regular meditation leads to clarity in thinking, better decision-making, and emotional balance.

While meditating, do not expect any outcome. Simply sit in silence and observe. Initially, you may feel that you are not meditating at all because your mind is filled with thoughts. This is perfectly normal.

Thoughts will arise and disappear continuously. The key is not to get carried away by them. Gently bring your attention back to your breath. Observe the thoughts without judgement, allow them to fade, and redirect your focus to breathing. This cycle will repeat — and that is part of the process.

With time, the experience of meditation becomes deeply enriching — something that cannot be fully expressed in words.

By the way, I am still a student and learning every day. There is always scope for improvement.

Enjoy meditation. You will begin to enjoy life.
You may also enjoy reading the post on 12 investment tips for life.

Meditation is a simple yet powerful practice to build focus, emotional balance, and clarity of thought. Learn how to start meditation with discipline and awareness.

June 28, 2010December 31, 2025

12 sure shot investment tips for life.

The best investment you can make is in yourself.
These 12 tips (in no particular order) focus on personal growth, mental well-being, and disciplined living. Over the long term, they can help enrich your life, bring clarity, balance, and lasting happiness.

1. Get up early

Let the calm, fresh, and powerful energy of the early morning prepare you mentally and physically for the day ahead.

2. Exercise

Walk, jog, practise yoga, pranayama, swim, or play any sport — just choose one and practise it regularly. Consistent physical activity helps maintain fitness, stamina, and overall health.

3. Meditate

Spend at least 15 minutes a day in silence. Meditation helps you connect with yourself, reduce stress, and improve emotional balance.

4. Contemplate

Take time out from busy schedules to contemplate. Reflection brings clarity of thought, improves decision-making, and helps you achieve more with focused effort.

5. Become aware of your breath at will

During the day, pause and observe your breath consciously. This simple practice improves focus, calms the mind, and aligns daily actions with long-term goals.

6. Cultivate a reading habit

Feed your mind with good books and positive thoughts. Reading expands perspective, enhances knowledge, and strengthens mental discipline.

7. Cultivate optimism

Think positively, think big, set meaningful goals, and visualise success. Imagination plays a powerful role in shaping outcomes — belief often precedes achievement.

8. Become humble

Stay flexible in life. You cannot change the direction of the wind, but you can adjust your sails. Just as grass survives storms better than rigid trees, adaptability builds resilience.

9. Learn to be forgiving

Be less demanding on yourself and forgiving towards others. Forgiveness conserves emotional energy, which can be channelled into more constructive and meaningful pursuits.

10. Learn to say no

Time is a precious resource. Learn to say no when needed, even in close relationships. Protecting your time helps preserve energy and focus on what truly matters.

11. Have purposeful goals in life

Clear purpose ensures that your subconscious efforts — every day, month, and year — are aligned toward meaningful and fulfilling long-term goals.

12. Who will cry when you die?

Keep this question in mind while dealing with family, friends, colleagues, and even strangers. It fosters gratitude, compassion, kindness, and selfless behaviour.

Oh, by the way, investment in the stock market is also important and will be discussed in a separate post.
My earlier post explains the purpose of investing. Investment decisions should always be aligned with clear life goals.

Enjoy and Enrich.

Personal growth is the foundation of long-term success. These 12 life investment principles focus on health, mindset, discipline, and purpose to build a balanced and fulfilling life.

Disclaimer

June 22, 2010December 31, 2025

Understand Charges Other Than Brokerage When Buying and Selling Shares in India

Most investors in India buy and sell shares through registered stockbrokers.
While brokerage charges are widely discussed, there are several other charges applicable when trading in shares that investors must be aware of.

These stock market charges in India are levied by stock exchanges, SEBI, clearing corporations, and the Government of India. They apply to transactions in equity shares, intraday trading, futures, and options.

Understanding these charges helps investors estimate the actual cost of buying and selling shares and avoid confusion while reviewing contract notes.

Check the Contract Note for Trading Charges

Whenever you buy or sell shares, a contract note is issued by your broker.
This document contains the complete breakup of:

Share quantity and price
Brokerage charges
Statutory charges and taxes
Net amount payable or receivable

Investors should always review the contract note to ensure accuracy in charges applied.

Charges Applicable When Buying and Selling Shares

In addition to brokerage, the following stock market transaction charges may apply:

Securities Transaction Tax (STT)
Exchange Transaction Charges
Stamp Duty
SEBI Turnover Fees
Goods and Services Tax (GST)
Depository Participant (DP) Charges

Overview of Stock Market Charges in India

Particulars	Equity Delivery	Intraday Trading	Futures Trading	Options Trading
Brokerage*	As per broker tariff	As per broker tariff	As per broker tariff	As per broker tariff
GST (18%)	On brokerage & exchange charges	On brokerage & exchange charges	On brokerage & exchange charges	On brokerage & exchange charges
Securities Transaction Tax (STT)	On buy & sell value	On sell value	On sell value	On option premium
Exchange Charges	As per NSE/BSE	As per NSE/BSE	As per NSE/BSE	As per NSE/BSE
Stamp Duty	On buy value	On buy value	On buy value	On buy premium
SEBI Turnover Fees	Nominal	Nominal	Nominal	Nominal
DP Charges	On sell transactions	Not applicable	Not applicable	Not applicable

* Brokerage charges vary across brokers. Please refer to your broker’s tariff sheet.

Miscellaneous Trading Charges (If Applicable)

Physical or Digital Contract Note Charges
Delivery Instruction Slip (DIS) Charges
Payment Failure or Cheque Bounce Charges
Interest on Delayed Payments

These charges may differ based on broker policies and account terms.

Example: Equity Delivery Transaction Cost Calculation

Scenario:
Purchase of 100 equity shares at ₹1,000 per share

Total Transaction Value:
₹1,00,000

Applicable Charges Include:

Brokerage (as per broker tariff)
GST @ 18% on brokerage & exchange charges
Securities Transaction Tax (STT)
Stamp Duty on buy value
Exchange transaction charges
SEBI turnover fees

Total Cost:
Higher than brokerage alone due to statutory and regulatory charges.

Why Understanding Trading Charges Is Important

Helps investors calculate net returns on equity investments
Reduces surprises in trading statements
Encourages cost-efficient investing
Improves awareness of share market charges in India

Key Takeaways for Investors

Brokerage is only one part of the total trading cost
Statutory charges apply uniformly across all brokers
Contract notes provide full transparency of charges
Awareness of costs supports better investment decisions

You can find more information on some of the terminologies related to Demat at http://www.sebi.gov.in/faq/faqdemat.html

Disclaimer

This content is for educational purposes only. Charges may change as per regulatory norms. Investors should verify details from official broker documents. Mutual fund investments are subject to market risks.

Resources

Calculators

Important

Resources

Calculators

Important

Effects of mandatory 25% free float —

Disclaimer

Disclaimer

Conclusion

Disclaimer

10 Steps to SIP in Stocks:

Disclaimer

Disclaimer

Stock Watch – Aban Offshore (July 2010)

Sharp Price Movements in Aban Offshore

Reason Behind the Sharp Fall

Recovery Phase Begins

Reason Behind the Upward Move

Impact of Financial Results

Possible Technical Levels to Watch

Long-Term Investor Perspective

Final Thoughts

How is meditation useful?

1. Get up early

2. Exercise

3. Meditate

4. Contemplate

5. Become aware of your breath at will

6. Cultivate a reading habit

7. Cultivate optimism

8. Become humble

9. Learn to be forgiving

10. Learn to say no

11. Have purposeful goals in life

12. Who will cry when you die?

Disclaimer

Check the Contract Note for Trading Charges

Charges Applicable When Buying and Selling Shares

Overview of Stock Market Charges in India

Miscellaneous Trading Charges (If Applicable)

Example: Equity Delivery Transaction Cost Calculation

Why Understanding Trading Charges Is Important

Key Takeaways for Investors

Disclaimer

AMFI Registered Mutual Fund Distributor | AMFI Registered SIF Distributor

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