What is Nifty 50 Index – Stocks, Companies List, Component and Weightage in 2023
This post was most recently updated on May 6th, 2023
What is NIFTY 50? The Nifty 50 is a stock market index in India that represents the performance of the top 50 companies listed on the National Stock Exchange (NSE). These companies are selected based on their market capitalization and other factors, and the Nifty 50 is widely considered to be a benchmark for the Indian stock market. In this article, we will look at stocks that are part of NIfty 50 component and their weightage in the NIFTY 50 Index.
What is Nifty 50 Index?
To start with Nifty 50 index is one of many Indices that NSE India has. NSE India is a stock exchange where it allows investors/traders to invest/trade in stocks. NSE India has created many stock indices to track the performance of markets in general, NIFTY 50 is one among the many Indices.
The Nifty 50 includes a diverse range of companies from various sectors, including banking, information technology, pharmaceuticals, and more. Some of the companies that are included in the Nifty 50 index are Reliance Industries, HDFC Bank, Infosys, and TATA Consultancy Services.
Each of the 50 companies included in the Nifty 50 index is assigned a weightage based on its market capitalization. This means that larger companies have a greater impact on the overall performance of the index.
For example, Reliance Industries, with a market capitalization of over INR 10 lakh crore, has a weightage of around 10% in the Nifty 50, while smaller companies have a lower weightage.
Understanding the Nifty 50 is important for investors who are looking to invest in the Indian stock market, as it provides a snapshot of the performance of the top companies in the country. By tracking the performance of the Nifty 50, investors can make informed decisions about which companies to invest in and how to allocate their portfolios.
Consider reading: What is Sensex Index
History of the NIFTY 50 Index
NIFTY 50 Index was launched on 22nd April 1996. The index was launched with a base value of 1000. As the name suggests, NIFTY 50 has 50 companies as part of its index.
The NIFTY 50 index is a well-diversified 50 companies index reflecting overall market conditions. NIFTY 50 Index is computed using the free-float market capitalization method.NIFTY 50 can be used for a variety of purposes such as benchmarking fund portfolios, launching index funds, ETFs, and structured products.
NIFTY 50 Stocks List in 2023
As of March 2023 below are the 50 companies/stocks that are part of the NIFTY 50 Stocks List:
|Adani Enterprises Ltd.||Metals & Mining||ADANIENT|
|Adani Ports and Special Economic Zone Ltd.||Services||ADANIPORTS|
|Apollo Hospitals Enterprise Ltd.||Healthcare||APOLLOHOSP|
|Asian Paints Ltd.||Consumer Durables||ASIANPAINT|
|Axis Bank Ltd.||Financial Services||AXISBANK|
|Bajaj Auto Ltd.||Automobile and Auto Components||BAJAJ-AUTO|
|Bajaj Finance Ltd.||Financial Services||BAJFINANCE|
|Bajaj Finserv Ltd.||Financial Services||BAJAJFINSV|
|Bharat Petroleum Corporation Ltd.||Oil Gas & Consumable Fuels||BPCL|
|Bharti Airtel Ltd.||Telecommunication||BHARTIARTL|
|Britannia Industries Ltd.||Fast Moving Consumer Goods||BRITANNIA|
|Coal India Ltd.||Oil Gas & Consumable Fuels||COALINDIA|
|Divi’s Laboratories Ltd.||Healthcare||DIVISLAB|
|Dr. Reddy’s Laboratories Ltd.||Healthcare||DRREDDY|
|Eicher Motors Ltd.||Automobile and Auto Components||EICHERMOT|
|Grasim Industries Ltd.||Construction Materials||GRASIM|
|HCL Technologies Ltd.||Information Technology||HCLTECH|
|HDFC Bank Ltd.||Financial Services||HDFCBANK|
|HDFC Life Insurance Company Ltd.||Financial Services||HDFCLIFE|
|Hero MotoCorp Ltd.||Automobile and Auto Components||HEROMOTOCO|
|Hindalco Industries Ltd.||Metals & Mining||HINDALCO|
|Hindustan Unilever Ltd.||Fast Moving Consumer Goods||HINDUNILVR|
|Housing Development Finance Corporation Ltd.||Financial Services||HDFC|
|ICICI Bank Ltd.||Financial Services||ICICIBANK|
|ITC Ltd.||Fast Moving Consumer Goods||ITC|
|IndusInd Bank Ltd.||Financial Services||INDUSINDBK|
|Infosys Ltd.||Information Technology||INFY|
|JSW Steel Ltd.||Metals & Mining||JSWSTEEL|
|Kotak Mahindra Bank Ltd.||Financial Services||KOTAKBANK|
|Larsen & Toubro Ltd.||Construction||LT|
|Mahindra & Mahindra Ltd.||Automobile and Auto Components||M&M|
|Maruti Suzuki India Ltd.||Automobile and Auto Components||MARUTI|
|Nestle India Ltd.||Fast Moving Consumer Goods||NESTLEIND|
|Oil & Natural Gas Corporation Ltd.||Oil Gas & Consumable Fuels||ONGC|
|Power Grid Corporation of India Ltd.||Power||POWERGRID|
|Reliance Industries Ltd.||Oil Gas & Consumable Fuels||RELIANCE|
|SBI Life Insurance Company Ltd.||Financial Services||SBILIFE|
|State Bank of India||Financial Services||SBIN|
|Sun Pharmaceutical Industries Ltd.||Healthcare||SUNPHARMA|
|Tata Consultancy Services Ltd.||Information Technology||TCS|
|Tata Consumer Products Ltd.||Fast Moving Consumer Goods||TATACONSUM|
|Tata Motors Ltd.||Automobile and Auto Components||TATAMOTORS|
|Tata Steel Ltd.||Metals & Mining||TATASTEEL|
|Tech Mahindra Ltd.||Information Technology||TECHM|
|Titan Company Ltd.||Consumer Durables||TITAN|
|UltraTech Cement Ltd.||Construction Materials||ULTRACEMCO|
|Wipro Ltd.||Information Technology||WIPRO|
Consider reading: Best Blue Chip Stocks in India
NIFTY 50 Index Weightage by Sector in 2023
By far the biggest sector within NIFTY 50 is the Financial services sector which is dominated by banks. The below table shows the weightage by sector for NIFTY 50.
|Oil, Gas & Consumable Fuels||12.27|
|Fast-Moving Consumer Goods||9.35|
|Automobile and Auto Components||5.60|
|Metals & Mining||3.17|
NIFTY 50 Top Weightage Stocks / Companies in 2023
Nifty 50 stocks weightage in 2023; Below are the top 10 companies as per their weightage. Reliance Industries, HDFC Bank, ICICI Bank and Infosys contribute 35 % of the NIFTY 50.
|Reliance Industries Ltd.||10.50|
|HDFC Bank Ltd.||9.23|
|ICICI Bank Ltd.||7.81|
|Housing Development Finance Corporation||6.16|
|Tata Consultancy Services Ltd.||4.45|
|Larsen & Toubro Ltd.||3.34|
|Kotak Mahindra Bank Ltd.||3.28|
|Axis Bank Ltd.||2.99|
NIFTY 50 Index Historical Performance
The below graph shows the historical performance of NIFTY 50. Nifty has come a long way from 1000 in 1996 to 18000 in 2022. That’s 18x returns in 25 years!
What are the Eligibility Criteria for a Stock/Company to be part of NIFTY 50?
As per NSE website
Eligibility Criteria for Selection of Constituent Stocks:
- Market impact cost is the best measure of the liquidity of a stock. It accurately reflects the costs faced when actually trading an index. For a stock to qualify for possible inclusion into the NIFTY50, have traded at an average impact cost of 0.50% or less during the last six months for 90% of the observations, for the basket size of Rs. 100 Million.
- The company should have a listing history of 6 months.
- Companies that are allowed to trade in the F&O segment are only eligible to be constituents of the index.
- A company that comes out with an IPO will be eligible for inclusion in the index if it fulfils the normal eligibility criteria for the index for a 3-month period instead of a 6-month period.
NIFTY 50 Index Re-Balancing
The index is re-balanced on a semi-annual basis. The cut-off date is January 31 and July 31 of each year, i.e. For a semi-annual review of indices, average data for six months ending the cut-off date is considered. Four weeks prior notice is given to the market from the date of the change.
A professional team manages all NSE indices. There is a three-tier governance structure comprising the Board of Directors of NSE Indices Limited, the Index Advisory Committee (Equity), and the Index Maintenance Sub-Committee.
What is the Importance of NIFTY 50 in the Indian Stock Market?
Although BSE Sensex is the oldest index in the Indian stock market NIFTY 50 is being tracked by many investors in India and all over the world. NIFTY 50 is considered the major Index of the Indian stock market. NIFTY 50’s performance is used to measure the stock market performance.
If you are a new investor then we suggest you get familiarised with NIFTY 50 stocks as they are often the top 50 stocks in Indian stock markets. The NIFTY 50 stocks are mostly considered the safest stocks to invest in.
There are many ETFs and Index funds that invest directly in Indices with a low cost of managing the fund. In that case, understanding NIFTY 50 becomes a crucial part of your investing journey.
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Advantages of Investing in NIFTY 50 Stocks
Investing in Nifty 50 stocks can offer a range of advantages for investors looking to grow their wealth over the long term. Here are some benefits to consider:
- Diversification: The Nifty 50 index includes a diverse range of companies from various sectors, which can help to spread risk and offer a level of diversification for investors. This means that if one sector is underperforming, the losses can be offset by gains in other sectors.
- Stability: The Nifty 50 index includes some of the largest and most stable companies in India, which can offer a level of stability for investors. These companies have a proven track record of success and are less likely to experience dramatic fluctuations in value.
- Liquidity: The Nifty 50 index includes some of the most actively traded stocks in India, which means that there is a high level of liquidity. This can be beneficial for investors who want to buy or sell their shares quickly and easily.
- Growth potential: Many of the companies included in the Nifty 50 index are leaders in their respective industries and have strong growth potential. This means that investors have the opportunity to benefit from the growth of these companies over the long term.
- Easy access: Investing in Nifty 50 stocks is easy and convenient, as investors can buy and sell shares through a range of brokers and online platforms. This makes it accessible to a wide range of investors, including those who are new to the stock market.
In conclusion, investing in Nifty 50 stocks can offer a range of advantages for investors, including diversification, stability, liquidity, growth potential, and easy access. As with any investment, it’s important to do your research and consult with a financial advisor before making any investment decisions.
FAQs on What is NIFTY 50 Index
What does NIFTY 50 mean?
Nifty 50 is one of the Indexes created in NSE which consists of 50 stocks. The purpose of NIFTY 50 is to track the underline performance of these 50 stocks which are part of the index
What do Sensex and nifty meaning?
Sensex is an index of 30 stocks and Nifty also called NIFTY 50 is an index of 50 stocks. Sensex is an index created by BSE and NIFTY 50 is an index created by NSE India
Sensex vs NIFTY which is better?
There is no comparison between Sensex and NIFTY as they are separate indexes on their own. SENSEX is an Index of 30 stocks so Sensex tracks the performance of 30 stocks only whereas NIFTY 50 is an index of 50 stocks that tracks the performance of 50 stocks. Historically Sensex and NIFTY have given similar returns on an index basis.
How do I invest in the NIFTY 50 Index?
If you want to directly invest in NIFTY 50 then you can either buy an ETF that invests in NIFTY 50 or you can buy an index fund that invests in NIFTY 50. If you are looking to invest in stocks that are part of NIFTY 50 then you can buy any stocks which are part of NIFTY 50 via your broker.
What are nifty's returns last 10 years?
From the level of around 5500 in Nifty in 2010; Nifty has reached 18000 in 2022 thus giving around 300% returns in 10 years.
What are the top 10 nifty 50 stocks?
As per the market cap, the top 10 nifty 50 stocks as of Jan 2021 are as below:-