Nifty Smallcap 100

NIFTY Smallcap 100

The Nifty Smallcap 100 Index includes some of the top small-cap stocks listed on the National Stock Exchange. The index seeks to strike a compromise between the emphasis of NIFTY Smallcap 50 and the diversity and inclusiveness of NIFTY Smallcap 250. Following the index allows you to keep track of significant small-cap firms in the Indian economy.

The NIFTY Smallcap 100 index is a broad-based NSE equities index that measures the performance of the small-cap segment. It includes all 50 stocks from the NIFTY Smallcap 50 index and 50 from the NIFTY Smallcap 250. The top sectors represented by the index are Financial Services at 26.60%, followed by Capital Goods, Information Technology, and Healthcare. The index is managed by NSE Indices Limited and has a three-tier structure. It also has a variant called the NIFTY Smallcap 100 Total Returns Index, useful for launching index funds, ETFs, structured products, and benchmarking portfolios.

History of the NIFTY Smallcap 100

This NIFTY Smallcap 100 index was introduced on January 1st, 2004, with a base value of 1,000. Since its establishment, the NIFTY Smallcap 100 share price has risen beyond 8,000. It is rebuilt on a semiannual basis.

How is the Value of the NIFTY Smallcap 100 Index Calculated?

The Nifty Smallcap 100 index is made up of several stocks, the prices of which are included in the index's total value.

Index Value = (Current Index Free Float Market Capitalisation / Base Free Float Market Capitalisation of Index) * Base Index Value

Where,

Index-Free Float Market Capitalization = Shares Outstanding * IWF * Capping factor * Price

[IWF = Investable Weight Factor, i.e. the fraction of outstanding shares that are open to trading for the public on the exchange.

Capping factor = 1 for uncapped indices.

The NIFTY Smallcap 100 stocks list is evaluated semi-annually, using six months of data in January and July of each year. The replacement of stocks (if any), subject to a maximum of 15 in a given year, is executed from the final trading day of March and September.

Factors Affecting the NIFTY Smallcap 100 Index

The following are some of the important elements influencing the NIFTY 100 Smallcap Index: 

• Interest rates and monetary policy - A reduction in the RBI's policy rates can boost the amount of investment and credit available in the economy. This will allow small-cap enterprises to obtain additional capital from financial markets.
• Government policies - Government initiatives aimed at bringing about structural and technical improvement that reduces costs for small businesses would increase the stock values of small-cap firms in general. For example, tougher competition regulations can help more small businesses compete against larger ones. Such steps may assist in enhancing investor trust in small-cap enterprises.
• FIIs and DIIs - If foreign institutional investors (FIIs) and domestic institutional investors (DIIs) decide to invest more money in the economy, it may assist increase the Nifty Smallcap 100 and other stocks.