The NIFTY Next 50 is a benchmark stock market index which is designed and managed by the India Index Services and Products Limited. It captures the performance of top 50 blue-chip companies
listed at NSE. NIFTY NEXT 50 comprises of 50 companies from NIFTY 100 after excluding the NIFTY 50 companies. To put in other words, NIFTY Next 50 represents companies which are currently present on the NIFTY 100 and could be potential candidates to be included in NIFTY 50.
Companies listed on the Nifty Next 50
As of May 31, 2018, the 50 companies which comprise of NIFTY NEXT 50 index have been mentioned below. The NIFTY NEXT 50 index reflects the overall dynamics of India’s equity market as well as the Indian economy. NIFTY NEXT 50 provides a representative benchmark for investments in top large-cap companies in India. It has a well-diversified portfolio across sectors and has relatively less concentrated exposure to any particular sector. Britannia Industries Ltd. holds the highest weightage at 5.06% followed by JSW Steel Ltd. at 5.01%.
*Note: Last Updated on 27th July 2018
| Symbol | Name of the Company | Industry |
|---|---|---|
| ABB | ABB India Ltd. | INDUSTRIAL MANUFACTURING |
| ACC | ACC Ltd. | CEMENT & CEMENT PRODUCTS |
| ABCAPITAL | Aditya Birla Capital Ltd. | FINANCIAL SERVICES |
| AMBUJACEM | Ambuja Cements Ltd. | CEMENT & CEMENT PRODUCTS |
| ASHOKLEY | Ashok Leyland Ltd. | AUTOMOBILE |
| AUROPHARMA | Aurobindo Pharma Ltd. | PHARMA |
| DMART | Avenue Supermarts Ltd. | CONSUMER GOODS |
| BANKBARODA | Bank of Baroda | FINANCIAL SERVICES |
| BEL | Bharat Electronics Ltd. | INDUSTRIAL MANUFACTURING |
| BHEL | Bharat Heavy Electricals Ltd. | INDUSTRIAL MANUFACTURING |
| BOSCHLTD | Bosch Ltd. | AUTOMOBILE |
| BRITANNIA | Britannia Industries Ltd. | CONSUMER GOODS |
| CADILAHC | Cadila Healthcare Ltd. | PHARMA |
| COLPAL | Colgate Palmolive (India) Ltd. | CONSUMER GOODS |
| CONCOR | Container Corporation of India Ltd. | SERVICES |
| CUMMINSIND | Cummins India Ltd. | INDUSTRIAL MANUFACTURING |
| DLF | DLF Ltd. | CONSTRUCTION |
| DABUR | Dabur India Ltd. | CONSUMER GOODS |
| EMAMILTD | Emami Ltd. | CONSUMER GOODS |
| GICRE | General Insurance Corporation of India | FINANCIAL SERVICES |
| GODREJCP | Godrej Consumer Products Ltd. | CONSUMER GOODS |
| HAVELLS | Havells India Ltd. | CONSUMER GOODS |
| HINDZINC | Hindustan Zinc Ltd. | METALS |
| ICICIPRULI | ICICI Prudential Life Insurance Company Ltd. | FINANCIAL SERVICES |
| IDEA | Idea Cellular Ltd. | TELECOM |
| INDIGO | InterGlobe Aviation Ltd. | SERVICES |
| JSWSTEEL | JSW Steel Ltd. | METALS |
| L&TFH | L&T Finance Holdings Ltd. | FINANCIAL SERVICES |
| LICHSGFIN | LIC Housing Finance Ltd. | FINANCIAL SERVICES |
| MRF | MRF Ltd. | AUTOMOBILE |
| MARICO | Marico Ltd. | CONSUMER GOODS |
| MOTHERSUMI | Motherson Sumi Systems Ltd. | AUTOMOBILE |
| NHPC | NHPC Ltd. | ENERGY |
| NMDC | NMDC Ltd. | METALS |
| OIL | Oil India Ltd. | ENERGY |
| OFSS | Oracle Financial Services Software Ltd. | IT |
| PETRONET | Petronet LNG Ltd. | ENERGY |
| PIDILITIND | Pidilite Industries Ltd. | CHEMICALS |
| PEL | Piramal Enterprises Ltd. | PHARMA |
| PFC | Power Finance Corporation Ltd. | FINANCIAL SERVICES |
| PGHH | Procter & Gamble Hygiene & Health Care Ltd. | CONSUMER GOODS |
| PNB | Punjab National Bank | FINANCIAL SERVICES |
| RECLTD | Rural Electrification Corporation Ltd. | FINANCIAL SERVICES |
| SBILIFE | SBI Life Insurance Company Ltd. | FINANCIAL SERVICES |
| SHREECEM | Shree Cement Ltd. | CEMENT & CEMENT PRODUCTS |
| SRTRANSFIN | Shriram Transport Finance Co. Ltd. | FINANCIAL SERVICES |
| SIEMENS | Siemens Ltd. | INDUSTRIAL MANUFACTURING |
| SAIL | Steel Authority of India Ltd. | METALS |
| SUNTV | Sun TV Network Ltd. | MEDIA & ENTERTAINMENT |
| MCDOWELL-N | United Spirits Ltd. | CONSUMER GOODS |
Sector Representation
The selection of securities and weights are based on free float market capitalization. When it comes to sector-wise representation of the index, the consumer goods sector tops the list at 25.60% while the financial services sector follows at 17.65%.
| Sector | Weightage (%) |
|---|---|
| Consumer Goods | 25.60 |
| Financial Services | 17.65 |
| Pharma | 6.59 |
| Energy | 4.11 |
| Automobile | 11.83 |
| Construction | 1.36 |
| Information Technology | 1.27 |
| Industrial Manufacturing | 6.68 |
| Cement and Cement Products | 6.84 |
| Metals | 8.75 |
| Chemicals | 2.58 |
| Telecom | 1.60 |
| Services | 3.83 |
| Media and Entertainment | 1.31 |
Eligibility Criteria
According to the NIFTY market indices methodology document, which is published by the India Index Services & Products Limited, the following are the eligibility criteria to be fulfilled by the companies to become a part of the NIFTY NEXT 50 index:
- In order to be considered to be included in the NIFTY NEXT 50 index, companies must form part of NIFTY 100, but should not be a part of the NIFTY 50.
- Eligibility criteria for newly listed security are checked based on the data for a three-month period instead of a six-month period
The NIFTY NEXT 50 index has a base date of November 03, 1996 while the base value is 1,000. As per the whitepaper of NIFTY Next 50 index, it has historically outperformed NIFTY 50 index since its inception with a higher return to risk ratio for longer periods.
How is NIFTY NEXT 50 calculated?
The NIFTY NEXT 50 is calculated using free float market capitalisation method. It is calculated online on all days that the National Stock Exchange of India is open for trading in equity shares and disseminated through trading terminals and website. Some of the popular utilisation of the NIFTY NEXT 50 index is to benchmark fund portfolios, launch Exchange Traded Funds (ETFs), index funds, and structured products. Constituent changes in the index along with corporate actions like right issuance, stock splits etc. are taken into consideration at the time of calculating the index. As NIFTY NEXT 50 is included in the broad based indices, it is reviewed twice every year based on six month data ending January 31 and July 31.
The NIFTY NEXT 50 is calculated based on the following formula:
Free Float Market Capitalisation = Shares Outstanding x Price x Investible Weight Factor (IWF)
Index Value = [(Current Free Float Market Capitalisation)/(Base Free Float Market Capitalisation)] x (Base Index Value)
Investible Weight Factor means the number of shares which are available to the public for general trading.
How to Invest in NIFTY NEXT 50?
You can invest in individual stocks that are a part of NIFTY NEXT 50. It is strongly advised to do a thorough research before investing your hard-earned money in stock markets as it is volatile in nature.
Stocks vs. Mutual Funds: here's what we recommend
Stock market investments require a lot of research and knowledge. They do not generally offer any tax benefits and are regarded as high-risk investments. Hence,it is crucial to have a diversified portfolio. At Bankbazaar, we encourage our readers to invest on mutual funds.It doesn't require a lot of knowledge and equity linked mutual fund schemes offer tax benefits. Additionally, since mutual funds comprise stocks from multiple companies, they help in building a diversified portfolio.
DISCLAIMER:
The contents of this post/blog does not constitute financial or other professional advice nor does it imply in any manner a principal-agent relationship, and is not a professional advice on a specific financial matter.
