Construction of Index

Calculation of Sensex (Index of BSE)

• Sensex is calculated using Weighted market capitalisation method.
• (Market Capitalisation = No. of outstanding(Floating) shares of
company * Current price per share
• Sensex comprises of stocks of top 30 companies. These companies
are selected on the basis of market cap.
• Free float market capitalisation of these 30 companies are
determined.
• Formula to calculate Sensex: (A*b/B)
Where A = Total free float market capitalisation (current market
value)
B = Base market capitalisation
b = base index value (for sensex it was 100)
 Calculation of Nifty
• Nifty comprises of stock of 50 companies.
• Nifty value = (A*B/b)
Where A = Total free float market
capitalisation (current market value)
B = Base market capitalisation
b = base index value
Base index value of nifty is 1000
 Full Float Methodology Vs. Free Float Methodology of
Market Capitalisation
• Market capitalization is nothing, but the outstanding number of shares,
multiplied by the current market price of a stock.
• For example, if a company has 2,00,000 outstanding shares and the price
of the share is Rs 10, we could say that the outstanding market cap of the
company is Rs 2 million.
• Free float market capitalization excludes: (i) Share which are locked in (ii)
Shares that are held by promoters (iii) Shares acquired by Foreign direct
investment (iv) Shares held by Government
• Whereas, in full float market capitalization all above category of shares
are considered.
• For calculation of sensex and Nifty free float capitalisation is considered.
Securities to be included in NIFTY
Full List of Nifty 50 Companies

Industry Security Name Weightage

(%)
Bajaj Auto Ltd. 0.74
Hero MotoCorp Ltd. 0.58
Eicher Motors Ltd. 0.51
Automobile
Mahindra & Mahindra Ltd. 0.76
Maruti Suzuki India Ltd. 1.59
Tata Motors Ltd. 0.36
Grasim Industries Ltd. 0.52
Cement  Shree Cement Ltd. 0.65
UltraTech Cement Ltd. 1.05
Cigarettes ITC Ltd. 4.18
Hindustan Unilever Ltd. 4.59
Britannia Industries Ltd. 0.88
Consumer Goods Nestle India Ltd. 1.62
Titan Company Ltd. 1.09
Asian Paints Ltd. 2.1
Oil & Natural Gas Corporation Ltd. 0.7
NTPC Ltd. 1.14
Power Grid Corporation of India Ltd. 1.14
Energy Bharat Petroleum Corporation Ltd. 0.71
Indian Oil Corporation Ltd. 0.58
Reliance Industries Ltd. 10.06
GAIL (India) Ltd. 0.4
Engineering Larsen & Toubro Ltd. 2.79
Fertilizer UPL Ltd. 0.5
Axis Bank Ltd. 2.39
HDFC Bank Ltd. 10.42
ICICI Bank Ltd. 5.85
IndusInd Bank Ltd. 0.59
Financial Services Kotak Mahindra Bank Ltd. 4.85
State Bank of India 2.11
Bajaj Finance Ltd. 1.64
Bajaj Finserv Ltd. 0.78
Housing Development Finance Corporation Ltd. 7.88
HCL Technologies Ltd. 1.32
Infosys Ltd. 6.56
Information Technology Tata Consultancy Services Ltd. 5.36
Tech Mahindra Ltd. 0.98
Wipro Ltd. 0.82
Media & Entertainment Zee Entertainment Enterprises Ltd. 0.32
Hindalco Industries Ltd. 0.39
Vedanta Ltd. 0.33
Metals & Mining JSW Steel Ltd. 0.41
Tata Steel Ltd. 0.57
Coal India Ltd. 0.82
Cipla Ltd. 0.6
Pharma Dr. Reddy’s Laboratories Ltd. 1.06
Sun Pharmaceutical Industries Ltd. 1.06
Shipping Adani Ports and Special Economic Zone Ltd. 0.54
Telecom Bharti Infratel Ltd. 0.38
 Stocks to be Included in Sensex
Last Mkt Cap
Company Name Industry Change %Chg
Price (Rs cr)
Asian Paints Paints 2,072.00 10.25 0.50 198,745.78
Axis Bank Bank - Private 488.80 16.55 3.50 149,580.67

Bajaj Auto Automobile - 2 & 3 Whee 3,038.35 -6.30 -0.21 87,919.83

lers
Bajaj Finance Finance - NBFC 3,218.80 -11.35 -0.35 193,960.81
Bajaj Finserv Finance - Investment 5,957.50 4.75 0.08 94,806.04

Bharti Airtel Telecommunication - Ser 396.75 -4.80 -1.20 216,449.24

vice Provider
HCL Tech IT Services & Consulting 846.00 18.90 2.29 229,576.07
HDFC Finance - Housing 2,028.00 67.95 3.47 364,189.44
HDFC Bank Bank - Private 1,207.10 8.10 0.68 664,352.13

HUL Household & Personal Pr 2,173.95 23.20 1.08 510,781.78

oducts
ICICI Bank Bank - Private 411.35 15.40 3.89 283,696.37
IndusInd Bank Bank - Private 622.25 14.20 2.34 47,070.21
Infosys IT Services & Consulting 1,120.95 -6.65 -0.59 477,458.79
ITC Cigarettes/Tobacco 167.20 1.45 0.87 205,740.21
Kotak Mahindra Bank - Private 1,365.30 28.75 2.15 270,246.72
Larsen Engineering & Constructi 891.20 -3.00 -0.34 125,127.59
on
M&M Automobile - Auto & Truc 602.50 -3.95 -0.65 74,902.35
k Manufacturers
Maruti Suzuki Automobile - Passenger C 6,856.85 -40.20 -0.58 207,131.77
ars
Nestle Consumer Food 15,742.00 307.80 1.99 151,777.62
NTPC Power Generation/Distri 80.90 0.55 0.68 80,046.97
bution
ONGC Oil Exploration and Produ 69.15 1.95 2.90 86,992.63
ction
Power Grid Corp Power Generation/Distri 160.20 1.25 0.79 83,810.07
bution
Reliance Oil Exploration and Produ 2,209.75 34.25 1.57 1,424,198.78
ction
SBI Bank - Public 200.65 4.85 2.48 179,072.33
Sun Pharma Pharmaceuticals & Drugs 485.10 -1.75 -0.36 116,391.74
Tata Steel Iron & Steel 395.65 1.80 0.46 44,569.56
TCS IT Services & Consulting 2,714.80 -47.70 -1.73 1,018,697.40
Tech Mahindra IT Services & Consulting 830.15 7.35 0.89 80,260.88
Titan Company Diamond & Jewellery 1,218.00 -5.10 -0.42 108,132.35
UltraTechCement Cement 4,515.80 36.05 0.80 130,339.34
 Bull Market
• Bull markets are defined by the market going up
aggressively over a period of time. As the market starts
to rise, there becomes more and more greed in the
stock market.
• What Causes a Bull Market?
• Though a wide range of different factors contributes to a bull market, the two
largest are usually
• A strong economy
• High employment levels across the board
 Bear Market
• The bear market definition is exactly the opposite of a bull
market. It’s a market where quarter after quarter the market is
moving down. That signals a bear market, and when that
happens people start to get really scared about putting money
into the stock market.
 Factors affecting Stock market
• Supply and Demand
• Company related factors
• Investors Sentiment (Bullish & Bearish )
• Interest Rates (Interest Rate Increases Market
Goes down and Vice versa)
• Political Factor
• Natural Calamities
• Exchange Rate (Domestic currency depreciates,
the stock market tends to go down)