What is the Stock Market and How It Works in India – 2025 Guide

What is the Stock Market and How Does it Work in India?

The stock market is one of the most important pillars of any economy. It enables companies to raise capital and gives individuals the opportunity to grow their wealth by investing in those companies. For many, the idea of the stock market still feels complex or even risky. At One Solution, we believe that understanding how the stock market works is the first step toward financial empowerment—and it’s far more accessible than most people think.

In India, the stock market has evolved dramatically over the past two decades. What was once a paper-based, broker-dependent system has transformed into a fully digital, real-time investing experience available to anyone with a smartphone and internet connection. With transparent regulations, seamless KYC processes, and intuitive mobile trading apps, the Indian stock market today welcomes both seasoned investors and first-time beginners.

Understanding the Stock Market – The Basics

The stock market is a regulated platform where shares of publicly listed companies are bought and sold. These companies are listed on major exchanges such as the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE)—the two most prominent stock exchanges in India.

When you buy a share of a company, you essentially buy a piece of ownership in that company. As a shareholder, you benefit from the company’s growth in two ways:

1. Capital Appreciation – When the share price increases over time.

2. Dividends – A portion of the company’s profits distributed to shareholders.

The stock market is broadly divided into two segments:

• Primary Market: This is where companies first issue shares to the public through Initial Public Offerings (IPOs).

• Secondary Market: Once listed, shares are traded between investors on a daily basis.

All transactions are carried out through SEBI-registered brokers and are settled electronically via Demat accounts, which store your shares securely in digital form.

How the Indian Stock Market Works

The stock market operates during fixed trading hours on working days. Investors place buy and sell orders using a trading account, which is linked to their Demat account and bank account. These orders are executed on the exchange through sophisticated technology that matches buyers with sellers in real-time.

Share prices are determined by a combination of factors:

• Market Demand and Supply

• Company Performance and Financial Health

• Macroeconomic Trends

• Global Events and Investor Sentiment

For example, if many investors want to buy shares of a particular company, the price tends to rise due to high demand. Conversely, if more people are selling, the price may fall.

India’s regulatory ecosystem is governed by SEBI (Securities and Exchange Board of India), which ensures transparency, protects investors, and maintains fairness across all transactions.

Why Should You Participate in the Stock Market?

Investing in the stock market is one of the most proven methods to generate long-term wealth. It not only helps you beat inflation but also gives your money the power of compounding when invested strategically.

Here’s why more Indians are entering the stock market:

• Accessibility: Demat account openings are now fully digital.

• Affordability: You can start investing with as little as ₹100.

• Control: You choose where to invest, how long to hold, and when to exit.

• Transparency: Real-time data, research, and tools help in decision-making.

• Liquidity: You can buy or sell shares quickly at current market prices.

How to Get Started

To start your journey in the stock market, you’ll need two essential accounts:

1. Demat Account: Stores your shares digitally.

2. Trading Account: Enables you to place buy/sell orders.

At One Solution, we offer:

• Free Demat and Trading Account Opening

• Zero Brokerage on Equity Delivery

• Integrated Market Research Tools

• User-Friendly App and Desktop Platforms

• Expert Support for Beginners

The process is entirely online, paperless, and typically takes less than 24 hours.

Final Thoughts from One Solution

The stock market is not just for experts—it’s for everyone. You don’t need a financial background or a large capital base to begin. What you do need is the willingness to learn, a reliable platform, and the patience to allow your investments to grow.

At One Solution, we are committed to making stock market investing simple, secure, and scalable. Whether you’re just starting or looking to deepen your investment strategy, we’re here to guide you with education, tools, and expert support.

Open your free Demat account today and begin your journey into the Indian stock market with confidence.