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Nvidia Corporation, the renowned chipmaker, has dethroned Microsoft to claim the title of the world's most valuable company, a testament to the surging demand for its products fueled by the burgeoning artificial intelligence (AI) wave. Nvidia's shares have soared over 3% on Tuesday, pushing its market valuation to a staggering USD 3.335 trillion, eclipsing Microsoft's valuation of USD 3.317 trillion. This remarkable ascent follows Nvidia's recent overtaking of Apple as the second most valuable company.
Nvidia's dominance in the AI and gaming sectors has been instrumental in its meteoric rise. The company's GPUs (Graphics Processing Units) are highly sought after for their ability to power AI algorithms and accelerate game performance. The burgeoning demand for AI solutions across various industries, coupled with the expanding gaming market, has propelled Nvidia's growth trajectory.
The company's stock price has skyrocketed this year, nearly tripling compared to a 19% rise in Microsoft's shares. This remarkable performance underscores the market's bullish sentiment towards Nvidia's future prospects. This surge in valuation can be attributed to Nvidia's innovative approach to AI and its ability to cater to the increasing need for advanced computing power.
Nvidia's journey to the top began in 1999 when it went public at a price of $12 per share. Since then, the company has consistently outperformed, driven by the expansion of the gaming industry and the emergence of new-age technologies. The company's stock splits, aimed at rewarding investors and making its shares more accessible, have further fueled its growth.
The sheer magnitude of Nvidia's success is evident in the returns realized by early investors. A hypothetical investment of Rs 10,000 in Nvidia's IPO in 1999 would have yielded astronomical returns, turning the investor into a millionaire. This remarkable return on investment is a testament to the power of long-term investing and the potential for growth in innovative technology companies.
Based on the prevailing rupee-dollar exchange rate in 1999, an investment of Rs 10,000 would have acquired approximately 19 shares of Nvidia. Over the years, the company's stock splits have transformed each initial share into 480 shares today. This means that the 19 shares acquired in the IPO would have multiplied to a staggering 9,120 shares.
At the current trading price of $135 per share, these 9,120 shares would be valued at a whopping $1.231 million, equivalent to approximately Rs 10.3 crore at the current exchange rate. This astonishing return demonstrates the compounding effect of long-term investments in growth companies like Nvidia.
The remarkable journey of Nvidia's stock price illustrates the potential for extraordinary returns in the stock market. Early investors who recognized the potential of this innovative company have been handsomely rewarded. However, it's important to note that past performance is not indicative of future results and investing in the stock market always carries inherent risks.
Source: If You Had Invested Rs 10,000 In Nvidia IPO In 1999, You Would Now Have...