Nifty Bank Stocks List and its Weightage

Nifty Bank Stocks List and its Weightage

The NIFTY Bank Index comprises of the most liquid and large Indian Banking stocks.Nifty Bank Stocks What is Bank Nifty It provides investors and market intermediaries a benchmark that captures the capital market performance of the Indian banks. Nifty Bank The Index comprises of maximum 12 companies listed on National Stock Exchange of India (NSE). NIFTY Bank Index is computed using free float market capitalization method. NIFTY Bank Index can be used for a variety of purposes such as benchmarking fund portfolios, launching of index funds, ETFs and structured products.

Bank Nifty Stocks List and its Weightage (31st March 2022)

Sl No Bank Name NSE Symbol Ownership Weightage
1 HDFC Bank Ltd. HDFCBANK Private 28.49%
2 ICICI Bank Ltd. ICICIBANK Private 22.45%
3 Axis Bank Ltd. AXISBANK Private 11.59%
4 Kotak Mahindra Bank Ltd. KOTAKBANK Private 11.39%
5 State Bank of India SBIN Government 11.12%
6 IndusInd Bank Ltd. INDUSINDBK Private 5.29%
7 AU Small Finance Bank Ltd. AUBANK Private 2.39%
8 Bandhan Bank Ltd. BANDHANBNK Private 1.81%
9 Bank of Baroda BANKBARODA PSU 1.81%
10 Federal Bank Ltd. FEDERALBNK Private 1.69%
11 IDFC First Bank Ltd. IDFCFIRSTB Private 1.07%
12 Punjab National Bank PNB PSU 0.91%

 

Eligibility Criteria for Selection of Constituent Stocks

Companies should form part of Bank Nifty at the time of review. In case, the number of eligible stocks representing a particular sector within NIFTY 500 falls below 10, then deficit number of stocks shall be selected from the universe of stocks ranked within top 800 based on both average daily turnover and average daily full market capitalisation based on previous six months period data used for index rebalancing of NIFTY 500.

 

  1. Companies should form a part of the Banking sector. iii. The company’s trading frequency should be at least 90% in the last six months.

 

Bank Nifty Stocks List  iv. The company should have a listing history of 6 months. A company which comes out with an IPO will be eligible for inclusion in the index, if it fulfills the normal eligibility criteria for the index for a 3 month period instead of a 6 month period. v. Companies that are allowed to trade in F&O segment are only eligible to be constituent of the index.

 

  1. Final selection of 12 companies shall be done based on the free-float market capitalization of the companies. vii. Weightage of each stock in the index is calculated based on its free-float market capitalization such that no single stock shall be more than 33% and weightage of top 3 stocks cumulatively shall not be more than 62% at the time of rebalancing.

 

Index Re-Balancing

 

Bank Nifty Weightage  Index is re-balanced on semi-annual basis. The cut-off date is January 31 and July 31 of each year, i.e. For semi-annual review of indices, average data for six months ending the cut-off date is considered. Four weeks prior notice is given to market from the date of change.

Index Governance

 

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.

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What is IPO (Initial Public Offering)

IPO full form is Initial Public Offereing. IPO is a process by which a privatly owned company issues its shares in public through stock exchanges either through OFS(Offer for Sale) or through Fresh Issue. OFS is used by existing shareholders to sale their holdings in public and Fresh Issue is used by the company to take fresh funds from public.

Nifty Bank Stocks List and its Weightage

Nifty Bank Stocks List and its Weightage

Why Company Issue IPO

Company raises equity fund from public by issuing IPO. Generally company issues equity shares for very long term business purposes. In equity funding, company does not have any liablity to pay back the funds to equity share holders in any case other than liquidation or bankruptcy. Equity shares are refered as less risky for the business of the company because there is nothing as a fixed obligation to pay as it is available in debt funding (Bank Loan etc.) but it cost the company’s existing shareholders very much because the promoters are compromising their shareholding percentange and in some cases their control over the company so if we say it is the costliest funding option then it is not wrong.

 

Who can apply in IPO and How to apply

Any person who has attained the age of 18 and is not restricted to act in the stock market by SEBI can apply for IPO in India if the person has the following documents and account such as a valid PAN Card, a Demat Account and a Bank Account can apply for IPO through many routes such as UPI, ASBA or by filling Physical form.

 

What is the benefit of applying in IPO

Suppose if the company in which you are applying is very good and have a siginificant market share in the industry from which it belongs can give you many benefits such as on the day of listing it can provide you short term gain by listing at a premium or can provide you long term gains and a oppertunity to grow your money many times just like Infosys Company but there is also a risk of lossing money for example many investors had lost their substantial part of their money in Coal India and RCOM.

 

disadvantage of IPO

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IPO Investing Suggestion (Conclusion)

So after watching the above image I think now you can cleary understand the risk portion of IPO Investment. So it is better for you to understand the consequences which can happen in future for that particular company in which you are investing through IPO route. IPO can provide you exceptional returns and can also wipe out your substantial capital so it is always better to choose good company with good future growth rate.

Apr 14, 2022 - Posted by Mukesh Saini - No Comments
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