The stocks in nifty metal index is given below, this post is to explore more about understanding the nifty metal index beyond it’s companies.
Table of Contents
What is Nifty Metal Index?:
Like Nifty 50 and Bank Nifty, the Nifty Metal Index is a stock market index designed to reflect the behavior and performance of the Metals sector in India (including mining). The Nifty Metal Index comprises of maximum 15 stocks that are listed on the National Stock Exchange (NSE). The index comprises of companies engaged in various metal industries such as steel, copper, aluminum, zinc, and other non-ferrous metals. The index includes both large-cap and mid-cap companies. The Nifty Metal index was launched in August 2011 and is calculated using free float market capitalization weighted methodology. This means that the weight of each stock in the index is proportional to its free float market capitalization. The index is reviewed twice a year, in January and July.
The highest weightage is given to Tata Steel at 20.84% followed by Adani at 16.09%. The complete list of stocks in Nifty Metal Index is given below. The nifty metal index is also known as cnx metal index.
Stocks in Nifty Metal Index with Their Weightage in 2023:
Note: If you are browsing on your phone use side scroll to scroll over to the weightage table.
| No. | Stock Name | Symbol | Weightage |
|---|---|---|---|
| 1 | Tata Steel Ltd | TATASTEEL | 20.84% |
| 2 | Adani Enterprises Ltd | ADANIENT | 16.09% |
| 3 | JSW Steel | JSWSTEEL | 15.74% |
| 4 | Hindalco Industries | HINDALCO | 14.17% |
| 5 | Vedanta Limited | VEDL | 6.89% |
| 6 | Apl Apollo Tubes Ltd | APLAPOLLO | 5.75% |
| 7 | Jindal Steel And Power Ltd | JINDALSTEL | 5.15% |
| 8 | Steel Authority of India | SAIL | 2.87% |
| 9 | National Mineral Development Corporation | NMDC | 2.81% |
| 10 | Jindal Stainless Limited | JSL | 2.91% |
| 11 | Hindustan Zinc Ltd | HINDZINC | 1.71% |
| 12 | National Aluminium Company Limited | NATIONALUM | 1.8% |
| 13 | Ratnamani Metals & Tubes | RATNAMANI | 1.42% |
| 14 | Hindustan Copper Ltd | HINDCOPPER | 0.97% |
| 15 | Welspun Corp Ltd | WELCORP | 0.88% |
Nifty Metal Index Historical Performance:
The index has given a return of 11.33% since inception and has a P/E ratio of 11.34 as of March 1 2023. Do check the current index value since it is calculated on a live basis.
Eligibility Criteria for a Stock to Be Added to the Index:
Stocks in nifty metal index are selected using the criteria given below. The stocks should satisfy all the given conditions to be added to the index.
- Companies should form part of Nifty 500 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 capital based on previous six months period data used
for index rebalancing of Nifty 500. - Companies should form a part of the Metals sector.
- The company’s trading frequency should be at least 90% in the last six months.
- 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.
- Final selection of companies shall be done based on the free-float market capitalization.
- 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.
When a stock satisfies all the criteria, it will be added to nifty metal index stocks list during index rebalancing after due consideration by the index governance team.
Index Rebalancing:
The 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 at IISL (India Index Services and Products Limited) manages NIFTY Metal Index. There is a three-tier governance structure comprising the Board of Directors of IISL, the Index Advisory Committee (Equity) and the Index Maintenance Sub-Committee. IISL is a NSE (National Stock Exchange) group company.
Key Insights into the Nifty Metal Index:
The performance of the Nifty Metal index is largely influenced by the global commodity prices especially metals, as most of the metal companies listed in the index are export-oriented. The demand for metals from China, the world’s largest consumer of metals, also plays a crucial role in the performance of the index. Any developments in the global commodity markets, such as changes in supply and demand dynamics or geopolitical tensions, can impact the performance of the index. The global container shortage which happened post covid provided an exceptional export market for Indian metal companies.
Another factor that affects the stock prices in the index is the domestic demand. The Indian government’s push for infrastructure development, particularly in the areas of housing, infrastructure, transportation, and energy, has led to increased demand for metals in the country. Export tax rates also affect the stock prices.
The metal index has some of the leading companies in the index which has delivered very good financial performance. Investing in the index is a very good option of investing in the Indian Metal industry. However, investors should keep in mind that investing in index comes with its own set of risks.
The performance of the index is closely linked to the global commodity markets, which are notoriously volatile. Any adverse developments in the global commodity markets can have a significant impact on the performance of the index. The Indian government has in the past imposed export restrictions and price controls on certain metals, which can negatively impact the performance of the companies listed in the Nifty Metal index.
How to Invest in Nifty Metal Index
There are no ETF which invest in the Nifty Metal Index, however you can buy the individual stocks at the given weightage. There are some mutual fund that invest in the Nifty metal index, some of them are
- ICICI Prudential Manufacture in India Fund
- Aditya Birla Sun Life India Manufacturing Fund
- SBI Magnum Comma Fund
- IDFC Sterling Value Fund
- Kotak India EQ Contra Fund
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