InvestmentFinancial Glossary
Face Value
Definition
The nominal or par value of a share, bond, or insurance policy as stated on the instrument. In Indian equities, face value is typically Rs 1, Rs 2, Rs 5, or Rs 10 per share. For bonds, face value is usually Rs 1,000. For insurance, it refers to the sum assured or sum insured.
Why It Matters
A stock's face value has no connection to its market price. A Rs 2 face value stock can trade at Rs 5,000. Face value matters for corporate actions like dividends (declared as a percentage of face value) and stock splits. A company splitting its Rs 10 face value into Rs 2 means you get 5 shares for every 1 share held.