NSE’s index services subsidiary, NSE Indices has launched a new thematic index called Nifty India Tourism which will track the performance of stocks in Nifty 500 index representing the travel and tourism theme.
The base date for the index is April 1, 2005 and the base value is 1,000. The index will be reconstituted semi-annually and rebalanced on a quarterly basis.
The index comprises 17 stocks including the likes of InterGlobe Aviation (Indigo), Indian Railway Catering and Tourism Corporation (IRCTC), Easy Trip Planners, GMR Airports Infrastructure, Devyani International, Jubilant Foodworks, Safari Industries (India), V.I.P. Industries and Mahindra Holidays & Resorts India among others.
In a media communique, NSE outlined its rationale behind the launch stating the government’s focus on the travel and tourism sector.
“India is a leading country in terms of international tourism expenditure. Travel and tourism are two of the largest industries in India, with a total contribution of about $199.6 billion to the country’s GDP,” reads the release.
Highlights
The index has a base date of April 01, 2005, with a base value of 1000.
Stocks part of the Nifty 500 index at the time of review are eligible for inclusion in the index.
Stocks forming part of the eligible basic industries shall be eligible to be included from the universe at the time of review.
The index comprises of a maximum of 30 stocks.
The weight of each stock in the index is based on free float market capitalization.
The index is reconstituted semi-annually and rebalanced quarterly.
Stock weights are capped at 20%.
Commenting on the launch, NSE Indices CEO Mukesh Agarwal said, “The Nifty India Tourism Index aligns with NSE’s vision to provide innovative indices in line with market trends. The launch of the Nifty Tourism Index will facilitate creation of products which will create opportunities for asset managers to invest in the tourism industry, thereby providing valuable tools for investors aiming to capitalise on the growth and resilience of this vibrant industry.”
The new index is expected to act as a benchmark for asset managers and be a reference index tracked by passive funds in the form of Exchange Traded Funds (ETFs), index funds and structured products.
Last month, NSE Indices had launched a new strategy index – Nifty500 Equal Weight which represents an alternative weighting strategy to its parent index, the Nifty 500. It includes the same companies as the Nifty 500, however, weighed equally.
Currently there are 17 thematic indices on the NSE viz. Nifty Commodities, Nifty India Consumption, Nifty CPSE, Nifty Energy and Nifty Infrastructure.
Apart from thematic indices, NSE operates Broad Market Indices (like Nifty, Nifty Next 50, Nifty 100, Nifty 100 etc) and 15 sectoral Indices including Nifty Bank, Nifty IT and Nifty Auto.
