Government will find it difficult to raise 2 lakh crores through Privatization but Mukesh Ambani of Reliance has raised that number in the lockdown.
Reliance is now 14% of Nifty50 .
- Top 20 Stocks are 79.26% of the Index. Lower than the peak of 80.4% .
- Top 10 Stocks are 62.6% of the Index. All time High Concentration.
- Banking and Financials continues to see weight drop from 40% to 33.16% .
- Reliance is the largest weight at 14%. Last 23 stocks weight combined now lesser than Reliance.
- Top 2 stocks 23.56% of the Nifty. Top 3 equal to 31.12% and Top 5 equal to 42.83%.
- 28 out of the Nifty50 stocks have a weight of less than 1%
- HDFC and HDFC Bank at 16.15% and 14% Reliance makes it a combined 30% !!
Interesting Sectoral Observations
- Financial Services down from 40.39% to 33.16%
- IT at 16.11% and Reliance at 14% + Bharti Airtel at 2.85% is now equal to Financial Services.
- Pharma has gone up from 2.15% to 3.18%
Guess where the Nifty should be 12000 or 10000 ?
What is Nifty Calculator ?
-> As per the weightages given by NSE for Nifty stocks we have created the Nifty Calculator.
-> Change the expected price and the expected Nifty will change accordingly
-> Create 3 different sheets for yourself–
Pessimistic ( where you put the worst possible prices you think . Default 15% down )
Optimistic ( the best prices possible. Default 15% up)
Neutral/Rational/Technical / Fundamental ( prices on any reasoning )
Please Note as weightages change every day by small margin this will not give an accurate estimate but will be approximate.
How to Guess?
- Everyone has a view on Nifty based on Macro, PE, Valuations, Technicals, Waves etc. Try to grill it down to the constituents. It should be a reflection of your actual guesstimate.
- Just estimating wild scenarios on the top 20 stocks is enough given the 80% weight.
- Start with changing default fall to 5-10-15-20-40-80 or rise to 5-10-20-40-80.
- Then change stocks which you think may not do the default move.
- Do send me the Excel Sheet if you get beyond 5000 or 12000 !! ( Mail me on firstname.lastname@example.org or 9819225396 )
Source: Technical Analysis of Indian Equities by Nooresh