Nifty PSE Index Climbs 2.64%, Led by Gains in NHPC, GAIL, and BHEL

The Nifty PSE Index ended yesterday’s trading session 2.64% higher at 9,278.65 and opened today at 9,315.15, marking a recovery after recent declines. Over the past month, the index has fallen 3.00%, while it has gained 7.00% over the last year. In comparison, the Nifty 50 index has risen 8.35% during the same period.

NHPC, GAIL, BHEL Shares – Key Nifty PSE Gainers of the Day

The session saw strong performances from several public sector enterprises. NHPC recorded the highest gain of 6.73%, while GAIL advanced 5.99%. BHEL followed closely, rising 5.97%. These stocks contributed significantly to the index’s upward movement, driven by positive market sentiment and sector-specific demand.

The broader movement in public sector enterprises aligns with recent trends in key industries, particularly power and infrastructure, which have benefited from government policies and investment plans.

Nifty PSE Index Composition and Sector Weightage

The Nifty PSE Index consists of 20 public sector enterprises, where the central or state government holds at least 51% of outstanding share capital. It follows the free-float market capitalisation methodology and undergoes semi-annual rebalancing.

The index includes companies from diverse sectors, with significant exposure to oil, gas, and power industries. The sectoral distribution of the index is as follows:

• Oil, gas and consumable fuels – 34.13%
• Power – 27.45%
• Capital goods – 18.14%
• Financial services – 13.10%
• Metals and mining – 3.32%
• Consumer services – 2.01%
• Services – 1.84%

Top Nifty PSE Stocks by Weightage

The major contributors to the index by weightage include NTPC at 13.41%, Power Grid Corporation of India at 11.88%, and BEL at 8.90%. Other key stocks in the index include ONGC at 7.88%, Coal India Ltd at 7.40%, and HAL at 6.74%.

The performance of these companies often influences the overall movement of the index, given their significant market capitalisation and sectoral impact.

Market Valuation and Performance Metrics of the Nifty PSE Index

As of 31 December 2024, the Nifty PSE Index had the following valuation metrics:

• Price-to-earnings (P/E) ratio – 12.35
• Price-to-book (P/B) ratio – 3.15
• Dividend yield – 2.06%

These figures provide insight into the index’s valuation relative to historical performance and broader market trends. The index remains an important benchmark for evaluating the financial health of public sector enterprises in India.

Next Rebalancing of the Nifty PSE Index

The Nifty PSE Index undergoes semi-annual rebalancing, with the next review scheduled for July 2025. The rebalancing process ensures that the index reflects the most relevant public sector enterprises based on market capitalisation and trading activity.

The index continues to serve as a key indicator of investor sentiment towards government-owned enterprises, with its movement reflecting broader economic and policy developments.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

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