The NIFTY 50 is a major stock index in India consisting of 50 of the largest companies that are traded on the National Stock Exchange of India. It was launched in 1996 and represents various sectors of the Indian economy. The index is calculated using the free-float market capitalization method, which takes into account only shares that are readily available for trading. Some key events in NIFTY's history include its launch in 1996, the commencement of internet trading in 2000, and reaching an all-time high in January 2018. The top three sectors represented are financial services, IT, and oil & gas.

1. DAYALBAGH EDUCATIONAL INSTITUDE
NIFTY
BBM-404 (Financial Management)
4/19/2018
An abstract over the leading share market index in India.
Submitted by
Karan Verma
167521
BBM (4th sem.)

2. 1
Introduction
The national stock exchange of India was promoted by leading financial institution at
the order of government of India and was incorporated in November 1992 as a tax
paying company. In April 1993, it was recognized as a stock exchange under the
securities contract (Regulation) Act, 1956. NSE commenced operation in June
1994The capital market segment of the NSE commenced operation in November
1994, while operation in the derivatives segment in June 2000.
NSE(NATIONAL STOCK EXCHANGE)
 India's largest financial market and index is NIFTY.
 Established in 1992
 Ranks third in the world for transacted volume.
 The best in terms of sophistication and advancement of technology 1600
companies Headquarters Mumbai Branches Ahmedabad, Chennai, Delhi, Kolkata,
Hyderabad Indore and Kanpur.
About NIFTY
 NIFTY is a major stock index in India introduced by the National stock exchange.
 NIFTY was coined from the two words ‘National’ and ‘FIFTY’. The word fifty is used
because; the index consists of 50 actively traded stocks from various sectors.
 The Nifty 50 was launched 1st April 1996, and is one of the many stock indices of
Nifty.
 The NIFTY 50 index is a free float market capitalisation weighted index.
 It represents the weighted average of 50 Indian company stocks in 12 sectors and
is one of the two main stock indices used in India, the other being the BSE sensex.
 Nifty is owned and managed by India Index Services and Products (IISL), which is a
wholly owned subsidiary of the NSE Strategic Investment Corporation Limited. IISL
had marketing and licensing agreement with Standard & Poor's for co-branding
equity indices.
 NIFTY comprises:
 Exchange traded funds (onshore and offshore),
 Exchange-traded futures and options (at NSE in India and at SGX and CME
abroad) and
 Other index funds and OTC derivatives (mostly offshore).
 NIFTY 50 is the world’s most actively traded contract. WFE, IOMA and FIA surveys
endorse NSE’s leadership position.
 From June 26, 2009, the computation was changed to free float methodology. The
base period for the CNX Nifty index is November 3, 1995, which marked the
completion of one year of operations of National Stock Exchange Equity Market
Segment. The base value of the index has been set at 1000 and a base capital of Rs.
2.06 trillion.
The 50 Companies In Nifty (with weightage)

3. 2
SECTOR CONSTITUENTS WEIGHTAGE
(%)
Telecom Bharti Airtel 1.4
Cigarettes ITC 5.59 Bharti Infratel 0.67
Pharmaceuticals Cipla 0.74 Consumer Goods Asian Paints 1.24
Dr. Reddy’s Lab 0.67 Hindustan Unilever 2.32
Lupin 0.49 Construction Larsen & Toubro 4.01
Sun Pharmaceutical 1.46 Media &
Entertainment
Zee Entertainment 0.76
Aurobindo Pharma 0.43 Shipping Adani Ports and
Special Economic
Zone Ltd.
0.77
Information
Technology
HCL Technologies 1.29 Agrochemicals UPL Limited 0.66
Infosys 5.79 Energy BPCL 0.83
TCS 3.73 HPCL 0.7
Tech Mahindra 0.95 GAIL (India) 0.73
Wipro 0.82 IOC 0.96
Cements Ambuja Cements 0.46 NTPC 1.23
UltraTech Cement 1.07 ONGC 1.31
Automobile Bajaj Auto 1.01 Power Grid 1.07
Bosch 0.42 Reliance Industries 8.13
Hero MotoCorp 1.15 Metals Coal India 1.00
Mahindra & Mahindra 1.68 Hindalco Industries 0.88
Maruti Suzuki 2.91 Tata Steel 1.29
Eicher Motors 0.90 Vedanta 1.51
Tata Motors 1.69
Financial Services Axis Bank 2.08
HDFC Bank 9.52
ICICI Bank 4.97
IndusInd Bank 2.12
Kotak Mahindra Bank 3.59
State Bank of India 2.46
Yes Bank 1.46

4. 3
Eligibility Criteria for Listing
The paid up equity capital of the applicant shall not be less than Rs. 10 crores and
the capitalisation of the applicant’s equity shall not be less than Rs. 25 crores2. The
Issuer shall have adhered to conditions precedent to listing as emerging from
inter- aliance from Securities Contracts (Regulations) Act 1956, Companies Act
1956, Securities and Exchange Board of India Act 1992.3. At least three years track
record.
Certifications
NSE also conducts online examinationand awards certification, under its
programmes of NSEs Certification in Financial Markets (NCFM). Currently,
certifications are available in 19 modules, covering different sectors of financial and
capital markets. Branches of the NSE are located throughout India.
Major indices
 S&P CNX Nifty(Standard & Poors CRISIL NSE Index)
 CNX Nifty Junior
 CNX 100 (= S&P CNX Nifty + CNX Nifty Junior)
 S&P CNX 500 (= CNX 100 + 400 major players across 72 industries)
 CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200)
Nifty Calculation
The Nifty is a market capitalization weighted index based on this Free Float Method. They
involve the total market capitalization of the companies weighted by their effect on the
index, so the larger stocks would make more of a difference to the index as compared to a
smaller market cap company
Key Points while calculating NIFTY
 1995 is taken to be the base year
 The base value is set at 1000
 Nifty calculation is done taking into consideration 50 stocks that are actively
traded on NSE
 These 50 top stocks belong to 24 sectors.
Market Capitalization = Shares outstanding * Market Price Per Share
Free Float Market Capitalization = Shares outstanding * Price * IWF (Investible
Weight Factor)
Index Value = Current Market Value / Base Market Capital *
Base Index Value (1000)

5. 4
IWF is a unit of floating stock expressed in terms of the number available for
trading. Base market capital of the Index is the combined market capitalisation of each
scrip comprising the Index during the base period and is equated to an Index value of
1000 known as the base Index value.
Example
Say NIFTY comprises only 2 stocks – A and B
Assume A has 1,000 shares. Promoters hold 200 and the rest 800 are available for active
trading and hence are free-floating. B has 2,000 shares. Its promoters hold 1000. Rest 1000
are free-floating.
Say price of A is Rs.10 and that of B is Rs.20
A’s total market capitalisation = 1,000 x Rs.10 = Rs.10,000
Free-float market cap = 800 x Rs.10 = Rs.8,000.
Similarly, B’s total market cap = 2,000 x Rs.20 = Rs.40,000.
B’s free-float market cap = 1000 x Rs.20 = Rs.20,000
Total free float market cap of A & B = Rs.(8,000+20,000)= Rs.28,000.
Assume Market Cap during 1995 was Rs.5,000
Then, NIFTY = 28,000*1000/5,000 = 5,600
Mile Stones
 November 1992 Incorporation
 April 1993 Recognition as a stock exchange
 October 1995 Became largest stock exchange in the country
 April 1996 Launch of S&P CNX Nifty
 November 1997 Best IT Usage award by Computer Society of India.
 May 1998 Launch of NSEs Web-site: www.nse.co.in
 February 2000 Commencement of Internet Trading
 January 2002 Launch of Exchange Traded Funds (ETFs)
 June 2007 NSE launches derivatives on Nifty Junior & CNX 100.
 November 2009 Launch of Mutual Fund Service System
 February 2010 Launch of Currency Futures on additionalcurrency pairs
Major trends in NIFTY
1st
- Major falls
Sl.
No.
Date Fall Reason

6. 5
1 October 28,
1997
8% Investors deserted emerging Asian shares during the Asian
Financial Crisis. Crashes also occurred in Thailand, Indonesia, South
Korea, Philippines,
2 January 21,
2008
10% Due to the US Subprime Mortgage Crisis.
3 August 16,
2013
234.4
Points
Due to depreciation of the Indian Rupee.
4 August 24,
2015
490.9
Points
Driven by the meltdown in the Chinese Stock market.
5 June 24, 2016 181.5
Points
Driven by the Brexit Referendum.
6 November 11,
2016
229.45
Points
Driven by the Demonetization move by the Indian Government
and the 2016 US Election Results.
2nd
Major rises
 All-time intraday high was 11,171.50 on January 29, 2018.
 All-Time Closing High was 11,130.40 on January 29, 2018.
References
www.wikipedia.com
www.nseindia.com
www.investopidia.com
www.niftyindices.com
www.moneycontrol.com