Nifty Midcap 150 is an index on the NSE (National Stock Exchange) that represents 150 companies ranked 101st to 250th based on market capitalisation (₹5,000 crore to ₹20,000 crore). The index is focused on evaluating the performances of companies with mid-market capitalisation. Nifty Midcap 150 index mutual funds track and mirror the performance of the Nifty 150 index in a bid to offer returns that closely match the index.
The table below provides a brief overview of the Nifty Midcap 150 index:
|Launch Date||1 April 2016|
|Base Date||1 April 2005|
|Number of Constituents/Companies||150|
|Methodology||Free Float Market Capitalization|
|Returns||1 Year – 3.66%|
5 Year – 12.53%
Since Inception – 16.16%
Nifty Midcap 150 index comprises 150 companies, ranked between 101st and 250th in the Nifty 500 index based on their full market capitalisation. To understand this further, let us explore the details of its rankings.
The first 50 companies listed on the Nifty 500 index are established industry leaders with large market capitalisation. These Nifty 50 companies comprise around 56% of the total market capitalisation of Nifty 500. The next Nifty 50 companies are businesses with maturing business models. These Nifty Next 50 companies hold 16.3% of Nifty 500’s total market capitalisation and are considered to be future superstars.
The Nifty Midcap 150 companies have evolving business models. These companies are focussed players with a high growth rate and consist of 18.5% of the total market capitalisation of Nifty 500f. As of February 06, 2023, the total market cap of Nifty Midcap 150 is ₹44,58,327.03 crore.
After this, there are the Nifty Small cap 250 companies which are characterised by unproven business models. These are niche players which hold 8.6% of the Nifty 500’s total capitalisation.
Given below in points are some of the important features:
The methodology adopted for computing this index is called the free float market capitalisation method. The underlying concept of this methodology is that the index level shows the free float market value of every stock it holds with respect to its base market capitalisation value.
As per the free float market capitalisation methodology, a company’s market capitalisation is calculated by taking into account only those free shares that are being actively traded in the open market. It excludes locked-in shares reserved for debt borrowers, and shareholding by founders, promoters, directors or partners. Shares held by hedge funds, private equity funds, mutual funds and equities held by cross-holdings and other trusts etc., are also excluded.
Free float market capitalisation is also referred to as float-adjusted capitalisation. An important point to remember is that the market capitalisation calculated using the free float market capitalisation methodology will always be less than the one calculated using the full capitalisation method.
Free float market cap = Current market price x (total number of shares – locked shares)
Let us understand this further with the help of an example. Provided below are the details of ABC Company:
The current market price is ₹50 per share. First, we need to calculate the market capitalisation and free float market capitalisation. The formula for calculating market capitalisation is as follows:
Market capitalization = total number of shares x current market price
So, ₹50 x 35,000 = ₹17,50,000
To calculate free-float market capitalisation, we need to follow these steps:
Number of shares unavailable for trading = Promoter Holding + Locked shares with Shareholders + Strategic Holding
So, the number of shares unavailable for trading is (5,000 + 2,000 + 1,000) = 8,000 shares
Therefore, free-float market capitalisation = ₹50 x (35,000 – 8,000)
= ₹50 x 27,000 = ₹13,50,000
Take a look at the eligibility criteria for getting included in this index:
The table below provides the list of the top 20 stocks on Nifty 150 Midcap along with their index weight:
|Name of the Stock||Index Weightage|
|Max Healthcare Institute Ltd||1.92%|
|Shriram Finance Ltd||1.69%|
|Varun Beverages Ltd||1.62%|
|AU Small Finance Bank Ltd||1.58%|
|Indian Hotels Company Ltd||1.58%|
|Federal Bank Ltd||1.56%|
|Tube Investments of India Ltd||1.55%|
|Yes Bank Ltd||1.47%|
|Ashok Leyland Ltd||1.43%|
|Tata Elxsi Ltd||1.37%|
|TVS Motor Company Ltd||1.36%|
|Persistent Systems Ltd||1.36%|
|Bharat Forge Ltd||1.29%|
|Max Financial Services Ltd||1.28%|
|LIC Housing Finance Ltd||1.24%|
|Page Industries Ltd||1.21%|
|Zee Entertainment Enterprises Ltd||1.20%|
|APL Apollo Tubes Ltd||1.17%|
This index comprises stocks of companies from a wide range of sectors. The table below represents a sector-wise representation of companies listed on the Nifty Midcap 150:
|Sector||Weight (in percentage)|
|Automobile and Auto Components||8.53%|
|Oil, Gas & Consumable Fuels||4.04%|
|Fast-Moving Consumer Goods||3.81%|
|Metals & Mining||2.93%|
|Media, Entertainment & Publication||1.42%|
Equity investments are always subject to market movements and Nifty Midcap 150 investment is no different. However, it has been seen that the index delivers good returns over long investment tenure.
In fact, the index has been able to generate 16.5% as average annual returns over the previous 15 years. If we have to elaborate in simpler words, suppose you have invested ₹10,000 every month in this index for 15 years. By March 2022, you would have been able to build a corpus of ₹78 lakh.
The average annual returns generated by Nifty 150 Midcap companies for the previous 15 years have exceeded 15%. This is more than the 14% generated by the average midcap funds over the same period.
To further elaborate, financial experts minutely compared the returns generated by actively managed mid-cap funds and that delivered by the index. It was quite evident that most midcap funds had failed to match the returns generated by the underlying index, i.e. the Nifty Midcap 150 has successfully delivered higher returns than most midcap mutual funds.
You can consider investing in stocks of Nifty 150 Midcap through index funds and ETFs (Exchange Traded Funds) that aim to replicate this index.
The table shows the main difference between these 2 index as follows:
|Nifty Midcap 100||Nifty Midcap 150|
|The main objective of the Nifty Midcap 100 index is to capture and reflect market movement of 100 mid-cap stocks listed on the National Stock Exchange.||It represents 150 companies ranked from 101 to 250 on the Nifty 500 index based on full market capitalisation. The objective of this index is to track the performance of mid-market capitalisation companies.|
The following table provides the main difference between these 2 index:
|Nifty Midcap 50||Nifty Midcap 150|
|The Nifty Midcap 50 index comprises the top 50 companies as per the full market capitalisation of the Nifty Midcap 150 index. An important factor to take into consideration is that preference is given to those stocks whose derivative contracts are available on NSE.||The Nifty Midcap 150 index comprises stocks of companies ranked between 101 and 250 according to their full market capitalisation.|
You can invest in Nifty Midcap 150 index fund via AMC or a third-party aggregator to capture the potential of the Nifty Midcap 150 index.
Since Nifty Midcap 150 index funds track the performance of the underlying index – Nifty Midcap 150 index – investing in such funds could help you benefit from the rapid growth of mid-cap companies. Note that these companies hold the potential of becoming market leaders in their own segment in the future.
You can also consider investing in the Nifty Midcap 150 Index Fund with Navi Mutual Fund. This scheme lets you capture the performance of 150 midcap companies at a lower cost. If you’re just starting out investing in the equity market, you can also choose to start small. With Navi Mutual Fund, you can start investing with as low as ₹10!
Nifty Midcap 150 index captures the performance of the top 150 mid cap companies ranked from 101 to 250 as per their full market capitalisation. It tracks the performances of companies with mid-market capitalisation.
As on February 6, 2023, Nifty Midcap 150 index stands at 11,602.95. Since its inception, this index has performed better than Nifty 100 and Nifty Small Cap 250 indices.
The full market capitalisation of midcap companies exceeds ₹5,000 crore but is less than ₹20,000 crore.
Nifty Midcap 150 has delivered a 16.16% in total returns since its launch on April 1, 2016.
Nifty Midcap 150’s 1-year CAGR returns stand at 70%.
Nifty Midcap 150 has generated 17.2% in 5-year returns.
Nifty Midcap 150 has delivered a 16.1% 3-year CAGR.
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