Nifty Financial Services Index: HDFC Bank & Bajaj Finance Drag

The Nifty Financial Services Index (FINNIFTY) represents the performance of India’s financial sector, encompassing banks, financial institutions, housing finance companies, insurance firms, and other financial services providers. It is composed of 20 stocks listed on the National Stock Exchange (NSE) and is computed using the free float market capitalisation method, ensuring a representation of market trends based on publicly traded shares.

Market Update: FINNIFTY Trades Lower

As of 3:24 PM on February 10, 2025, the Nifty Financial Services Index is down by 0.63%. Market sentiment remains weak, with 17 out of 20 stocks in red, while only three stocks are trading in the green.

Key contributors to the decline include HDFC Bank and Bajaj Finance, which have acted as draggers for the index. However, Kotak Bank and ICICI Bank have provided some support, helping the index recover from its intraday low.

Valuation Insights: Price-to-Book Ratio Below Averages

The price-to-book (PB) ratio of FINNIFTY currently stands at 2.84, which is lower than its short-term and long-term averages. Specifically, it is below:

• 1-month, 3-month, and 6-month averages
• 1-year, 2-year, and 5-year averages

The PB ratio is a key valuation metric for financial stocks, offering insights into whether the index is trading above or below its intrinsic value. A lower PB ratio may indicate potential undervaluation or weaker market sentiment in the financial sector.

Performance Overview: Outperforming the Nifty50 in 2025

Despite the recent decline, FINNIFTY has outperformed the broader Nifty50 index in CY 2025, registering a 0.55% decline so far. The index delivered a nearly 10% gain in CY 2024. 

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. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing