Last updated on August 2, 2024
The Nifty FMCG Index is designed to reflect the behavior and performance of Fast-Moving Consumer Goods (FMCG) manufacturers. These are non-durable, mass-consumption products that are available off the shelf to consumers. The Nifty FMCG Index comprises 15 stocks from the FMCG sector listed on the National Stock Exchange (NSE).
In this article, we have compiled a Nifty FMCG stocks list with weightage which is periodically updated. Nifty FMCG companies index can be used to benchmark fund portfolios and launch index funds by mutual funds, ETFs, and structured products.
What is the Nifty FMCG index?
Fast-moving consumer goods are nondurable products that sell quickly at relatively low costs. Since FMCG products are priced low, they feature slim margins but high sales volumes. Examples of FMCGs include daily-use products including milk, fruits, vegetables, edible oil, soap, toothpaste, facial creams, and over-the-counter drugs.
The Nifty FMCG Index is computed using the free float market capitalization method, wherein the level of the index reflects the total free float market value of all the stocks in the index relative to a particular base market capitalization value. The index has a base date of 1 January 1996 indexed to a base value of 1000 but it was launched only in September 1999.
The Nifty FMCG Index can be used for various purposes such as benchmarking fund portfolios and launching index funds, ETFs, and structured products.
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Nifty FMCG Companies Re-Balancing
Constituent companies in the Nifty FMCG Index are re-balanced on a semi-annual basis. The cut-off date is 31 January and 31 July of each year, i.e. for a semi-annual review of indices, average data for 6 months ending the cut-off date is considered.
A prior notice of at least four weeks is given to the market from the date of the change. As a result, changes made on 31 January will be effective from 31 March.
Index Governance
A professional team manages all NSE indices. There is a three-tier governance structure comprising the Board of Directors of NSE Indices Limited, the Index Advisory Committee (Equity), and the Index Maintenance Sub-Committee.
Nifty FMCG Index: Key Drivers
- The FMCG industry in India is considered one without cyclicality given the huge size of the market, fairly diversified product portfolio, and inelastic nature of demand. As a result, index heavyweights including ITC, Hindustan Unilever, Nestle India, and Britannia Industries, have posted strong topline and bottom-line performances over the years.
- Stable raw material prices are another characteristic of this industry as most of the ingredients are available and sourced locally. This gives earnings visibility to investors.
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Nifty FMCG Weightage
In terms of weightage, the top companies in the Nifty FMCG Stocks list are ITC (34.93%), Hindustan Unilever (19.31%), Nestle India (7.01%), Tata Consumer Products (6.21%), and Varun Beverages (6.06%).
Nifty FMCG Stocks List With Weightage
Company Name | Industry | Price (INR) | Weightage(%) |
ITC Ltd. | Cigarettes/Tobacco | 489.90 | 34.93 |
Hindustan Unilever Ltd. | Household & Personal Products | 2,691.40 | 19.31 |
Nestle India Ltd. | Consumer Food | 2,457.65 | 7.01 |
Tata Consumer Products Ltd. | Tea/Coffee | 1,194.90 | 6.21 |
Varun Beverages Ltd. | Consumer Food | 1,577.40 | 6.06 |
Britannia Industries Ltd. | Consumer Food | 5,842.20 | 5.46 |
Godrej Consumer Products Ltd. | Household & Personal Products | 1,439.80 | 4.36 |
Colgate Palmolive (India) Ltd. | Household & Personal Products | 3,366.55 | 3.64 |
United Spirits Ltd. | Breweries & Distilleries | 1,409.25 | 3.29 |
Dabur India Ltd. | Household & Personal Products | 633.90 | 2.97 |
Marico Ltd. | Consumer Food | 681.00 | 2.79 |
Procter & Gamble Hygiene & Health Care Ltd. | Household & Personal Products | 17,039.95 | 1.27 |
United Breweries Ltd. | Breweries & Distilleries | 2,015.85 | 1.19 |
Radico Khaitan Ltd | Breweries & Distilleries | 1,728.80 | 1.07 |
Balrampur Chini Mills Ltd | Consumer Food | 480.40 | 0.44 |
Nifty FMCG Index Vs Other Sectoral IndicesÂ
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Nifty FMCG Stocks List: Eligibility CriteriaÂ
- Companies should form part of the Nifty 500 at the time of review. In case, the number of eligible stocks representing a particular sector within the Nifty 500 falls below 10, then the deficit number of stocks shall be selected from the universe of stocks ranked within the top 800 based on both average daily turnover and average daily full market capitalization based on previous 6 months period data used for index rebalancing of Nifty 500.Â
- Companies should form a part of the FMCG sector.
- The company’s trading frequency should be at least 90% in the last 6 months. Â
- The company should have a listing history of 6 months. A company that comes out with an IPO will be eligible for inclusion in the index if it fulfills the normal eligibility criteria for the index for 3 months instead of 6 months.
- The final selection of 15 companies shall be based on the companies’ free-float market capitalization. A preference shall be given to companies that are available for trading in NSE’s Futures & Options segment at the time of final selection.
- Nifty FMCG Weightage of each stock is calculated based on its free-float market capitalization such that no single stock shall be more than 33% and the weightage of the top 3 stocks cumulatively shall not be more than 62% at the time of rebalancing.Â
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Nifty FMCG Stocks List: Eligible Basic IndustriesÂ
Companies from the following industries are eligible to be considered for inclusion in the Nifty FMCG Index List:Â
- Animal Feed
- Breweries & Distilleries
- Cigarettes & Tobacco Products
- Dairy Products
- Diversified FMCG
- Edible Oil
- Household Products
- Meat Products including Poultry
- Other Agricultural Products
- Other Beverages
- Other Food Products
- Packaged Foods
- Personal Care
- Seafood
- Stationary
- Sugar
- Tea & Coffee
Conclusion
As the industry caters to the basic needs of consumers, it plays an important role in the Indian economy and weighs nearly 8.46% in the Nifty 50 Index. While this industry benefits from robust and inelastic demand and has the advantages of shallow corrections, it is not free of the regular pitfalls in equity investments such as overvaluation and demand collapse.
Nifty FMCG Index Weightage FAQs
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How many stocks are there in the Nifty FMCG Index?
Nifty FMCG Index has 15 stocks like ITC, Hindustan Unilever, and Nestle India.Â
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How frequently is the Nifty FMCG Index rebalanced?
The Nifty FMCG Index is rebalanced every 6 months with the cut-off dates being 31 January and 31 July of each year.
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Which company tops in Nifty FMCG weightage stocks?
On 31 July 2024, ITC Ltd had the maximum weightage of 34.93%, followed by Hindustan Unilever Ltd. at 19.31%.
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What is Nifty FMCG’s performance in the last 12 months?
As of 31 July 2024, the index had returned 20.12% over the last 1 year including dividends.
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Can we trade directly in the Nifty FMCG index?
Unfortunately, there are no instruments to trade intraday in the index. However, various mutual funds and ETFs are tracking the FMCG index. One such example is ICICI Prudential Nifty FMCG ETF. Investors can also pick sectoral mutual fund schemes like Nippon India ETF Nifty India Consumption which has a good overlap with Nifty FMCG Index.