Dive into the Details of NSE’s Latest Index Additions and Their Implications for Investors
The National Stock Exchange (NSE) has announced the introduction of four new indices, effective from April 8, expanding investment opportunities for market participants across both cash and derivatives segments. These indices promise to offer diversified exposure to various sectors and themes, catering to the evolving needs of investors. Let’s delve into the specifics of each index:
1. Nifty Tata Group 25% Cap: The Nifty Tata Group 25% Cap Index is composed of 10 companies and constructed using the free float market capitalization method. This index aims to provide investors with exposure to select entities within the Tata Group conglomerate while ensuring diversification. Notable components of this index include Tata Consultancy Services Ltd, Tata Motors Ltd, and Titan Company Ltd, among others.
2. Nifty 500 Multicap India Manufacturing 50:30:20: This index seeks to mirror the performance of large cap, mid cap, and small cap stocks from the Nifty 500 index, focusing on the manufacturing theme. The allocation of stocks is determined based on their free-float market capitalization, with 50% allotted to large caps, 30% to mid caps, and 20% to small caps.
3. Nifty 500 Multicap Infrastructure 50:30:20: Reflecting the infrastructure theme, this index aims to track the performance of large cap, mid cap, and small cap stocks from the Nifty 500 index. The weightage of stocks is proportionate to their free-float market capitalization, with 50% allocated to large caps, 30% to mid caps, and 20% to small caps.
4. Nifty MidSmall Healthcare: Targeting the healthcare sector, this index focuses on midcap and small cap stocks, providing investors with exposure to this dynamic segment. Comprising up to 30 stocks, the index weights are determined by the free-float market capitalization of individual stocks.
NIFTY TATA GROUP 25% CAP Index Components by Weightage – NSE
| Company | Weightage* |
| TATA CONSULTANCY SERVICES LTD | 50.19% |
| TATA MOTORS LTD | 11.67% |
| TITAN COMPANY LTD | 11.62% |
| TATA STEEL LTD | 7.11% |
| TRENT LTD | 4.88% |
| TATA POWER COMPANY LTD | 4.62% |
| TATA CONSUMER PRODUCTS LTD | 3.70% |
| THE INDIAN HOTELS COMPANY LTD | 3.04% |
| TATA ELXSI LTD | 1.75% |
| VOLTAS LTD | 1.42% |
These new indices offer investors diversified exposure to various sectors and themes, enabling them to align their investment strategies with specific market trends and themes. Moreover, they provide valuable benchmarking tools for portfolio performance evaluation and investment decision-making.
As investors navigate an ever-changing market landscape, these indices serve as valuable instruments for portfolio diversification and risk management strategies.
