India’s first electric vehicle index launched by National Stock Exchange
India’s first electric vehicle index launched by National Stock Exchange

India’s first electric vehicle index launched by National Stock Exchange

May 31, 2024
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The National Stock Exchange’s index services subsidiary, NSE Indices Ltd, has launched the Nifty EV & New Age Automotive index, marking India’s first stock exchange index to track the performance of companies within the electric vehicle (EV) ecosystem. This thematic index aims to provide a comprehensive overview of the electric and new-age automotive sectors.

Focus and Scope of the Index

Designed to monitor companies involved in the electric vehicle ecosystem, the Nifty EV & New Age Automotive index includes firms developing electric vehicles and new-age automotive technologies such as hybrid and hydrogen fuel vehicles. This ensures the index captures the breadth of advancements in the EV market.

Eligibility Criteria and Composition

Companies eligible for inclusion in the index must be part of the broader Nifty 500 index and engaged in producing or supplying electric or new-age automotive vehicles, batteries, components, raw materials, and technology. Presently, the index comprises 33 stocks, reflecting a diverse representation of the sector.

Top Constituents by Weightage

The leading companies by weightage in the index include, 

Bajaj Auto
Tata Motors Ltd
Maruti Suzuki India Ltd
Mahindra & Mahindra Ltd
Exide Industries Ltd
Bosch Ltd
Samvardhana Motherson International Ltd
Eicher Motors Ltd
CG Power and Industrial Solutions Ltd and
Himadri Speciality Chemical Ltd.

These companies play pivotal roles in the EV ecosystem, underscoring the index’s comprehensive nature.

Benchmark and Investment Reference

This new index is expected to act as a benchmark for asset managers and a reference index for passive funds such as Exchange Traded Funds (ETFs), index funds, and structured products. The base date for the index is April 2, 2018, with a base value of 1000. Reconstitution will occur semi-annually, and rebalancing will be quarterly to maintain accuracy and relevance.

Investment Opportunities Created

NSE Indices CEO Mukesh Agarwal highlighted that the index’s launch creates investment opportunities for asset managers in the electric vehicle and new-age automotive markets. This initiative aims to provide investors with a dedicated vehicle to invest in the rapidly growing EV sector, aligning with broader market trends.

Government Initiatives and Market Growth

This index launch aligns with the Indian government’s efforts to promote vehicles powered by batteries and alternate fuels. Electric vehicle adoption is notably increasing in the two and three-wheeler segments. During 2023-24, approximately 1.6 million electric vehicles were sold in India, including 944,126 two-wheelers, 632,485 three-wheelers, 90,432 four-wheelers, and 3,693 buses, according to the Vahan portal.

Future Market Developments

Several key developments are expected in the Indian EV market. Ola Technologies, a major player in electric two-wheelers, is set to list its shares on the stock exchanges soon. Additionally, Ather Energy and Hyundai Motor India are planning initial public offerings. Tata Motors has announced a significant restructuring plan to split into two publicly traded companies, focusing on commercial vehicles and passenger vehicles, including its EV business and Jaguar Land Rover.

These strategic initiatives highlight the evolving and dynamic nature of India’s electric vehicle market, indicating significant potential for future growth and innovation. 

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The post India’s first electric vehicle index launched by National Stock Exchange appeared first on E-Vehicleinfo.

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