[quote=Kihangeri]Where is the connection between prices of shares at the stock market or elsewhere and dividends that Britank will pay shareholders? I assume Britank does not trade in shares it holds at the NSE. So, if Equity will pay Britank better dividends than it did in 2010, why does the price of Britank get affected by unrealized reduced book value etc.

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I tend to think having shares in Equity, centum, etc is just a diversification of its portifolio which is of paltry value. Other major business like the insurance may affect the total value if their earning are lower than before. For Instance if dividend payout was 80cents last FY, then this year may be reduced by 25% which means they can only be able to pay 60cents or less this FY.

Let us say Equity gave Britak 1 Billion as dividends in 2010. What dividend is it likely to get for Financial Year 2011. Will it be more or less than 1 Billion?

If an asset has a maturity date (for redemption at a certain value, e.g. a bond), then it can be 'held to maturity'.

But if the asset has no maturity / has no pre-agreed redemption value, then it is (not clear how it can be held to maturity and must be) booked on the trading book and is affected by fair market price movements.