This is the intrinsic value of the shares of a company. The founders decide the par value of stock at the time of incorporation. The par value is mentioned in the company’s charter documents.

Par value is different from market value. Market value is the value at which the stock is trading currently in the market. No stock can be traded below the par value of the stock.

While shares cannot be issued below its par value, the opposite is possible. If the issue price is more than the par value of shares then it is termed as premium.