NSE Index Rejig: Jio Financial & Zomato Join Nifty 50, BPCL & Britannia to Exit
NSE Index Rejig : The National Stock Exchange (NSE) has announced a significant reshuffle in its benchmark Nifty 50 index, with Jio Financial Services Ltd. (JFSL) and food delivery giant Zomato set to join the prestigious index. Meanwhile, Bharat Petroleum Corporation Ltd. (BPCL) and Britannia Industries Ltd. will exit. These changes, effective March 28, 2025, mark a major shift in the composition of India’s most widely tracked stock index.
This reshuffle indicates the growing dominance of new-age technology and fintech companies in the Indian market, with traditional heavyweights like BPCL and Britannia making way for emerging leaders in the digital space.
Why the Change? Understanding NSE’s Index Rebalancing
The Nifty 50 undergoes a semi-annual review to ensure it reflects market trends and maintains its relevance for investors. The inclusion of Zomato and Jio Financial Services is driven by their strong free-float market capitalization, which must be at least 1.5 times that of the smallest companies being removed.
Market Capitalization Comparison
| Company | Market Capitalization (₹ Crore) |
|---|---|
| Zomato | 1,69,837 |
| Jio Financial Services | 1,04,387 |
| BPCL | 60,928 |
| Britannia Industries | 64,151 |
With Zomato and JFSL surpassing the free-float market cap criteria, they have gained a spot in the Nifty 50 index, while BPCL and Britannia fall short and are thus excluded.
Key Criteria for Inclusion in Nifty 50
- A stock must be a part of the Futures & Options (F&O) segment.
- The company’s free-float market cap must be 1.5 times that of the smallest index constituent.
- The average free-float market cap is measured over six months, in this case, from August 1, 2024, to January 31, 2025.
Impact of Nifty 50 Inclusion and Exclusion
According to Nuvama Wealth Management, the changes in the Nifty 50 will bring substantial foreign and domestic fund inflows into the newly added stocks, while the removed stocks will experience outflows.
Estimated Fund Flows Due to Rebalancing
| Company | Estimated Inflows/Outflows (USD Million) |
|---|---|
| Zomato | +631 |
| Jio Financial Services | +320 |
| BPCL | -201 |
| Britannia Industries | -240 |
The increased institutional buying in Zomato and Jio Financial Services could drive their stock prices higher, while BPCL and Britannia may see temporary pressure due to outflows.
Significance of Jio Financial & Zomato’s Entry
This marks the first time that digital-era stocks like Zomato have entered India’s flagship stock index. It highlights the growing importance of technology-driven businesses in the Indian economy.
- Zomato’s Growth Story: From being an online food aggregator, Zomato has expanded into quick commerce with Blinkit, achieving ₹1,69,837 crore in market capitalization.
- Jio Financial’s Rise: Spun off from Reliance Industries, JFSL has quickly established itself in the NBFC space, with a market cap of ₹1,04,387 crore.
How Will Investors Be Affected?
For Passive Investors & Mutual Funds
- Index funds and ETFs tracking Nifty 50 will need to buy shares of Zomato and Jio Financial while selling BPCL and Britannia.
- This could result in short-term price volatility in these stocks.
For Retail Investors
- Zomato and Jio Financial may gain momentum due to increased demand from institutional investors.
- BPCL and Britannia might face selling pressure but could offer attractive valuations for long-term investors.
Financial Ratios of Companies Involved
| Company | P/E Ratio | P/B Ratio | Debt-to-Equity Ratio | ROE (%) |
|---|---|---|---|---|
| Zomato | 120.5 | 9.2 | 0.02 | 8.5 |
| Jio Financial Services | 45.8 | 6.5 | 0.01 | 10.2 |
| BPCL | 6.8 | 1.4 | 0.65 | 12.4 |
| Britannia Industries | 42.1 | 21.3 | 0.34 | 32.7 |
- Zomato’s high P/E ratio reflects strong growth expectations.
- Jio Financial has a healthy ROE and low debt, making it an attractive addition.
- BPCL’s low P/E signals an undervaluation, but its high debt-to-equity ratio may have played a role in its exclusion.
Final Thoughts: The Future of Nifty 50
The inclusion of Zomato and JFSL signifies a shift in India’s stock market landscape toward digital and financial technology-driven companies. This move aligns the index with changing economic trends and investor preferences.
As the Nifty 50 continues to evolve, investors should closely monitor how these changes impact market dynamics. Will Zomato and JFSL live up to the high expectations? Only time will tell.
What are your thoughts on this reshuffle? Let us know in the comments!
For more market insights, follow our news.
Stay tuned for more updates and insights on the stock market! For more insights on investing in the Indian stock market, check out resource like ET, NSE India.
Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.