NSE companies achieve $5 Trillion market cap milestone in record six months

The market capitalisation (m-cap) of companies listed on the National Stock Exchange (NSE) surpassed the $5 trillion (₹ 416.57 lakh-crore) mark. On May 24, the NIFTY index breached the 23,000 level for the first time in the morning trade.

The NSE-listed companies surged from $4 trillion to $5 trillion in a six-month gap. Earlier, it had touched the $4 trillion mark in December 2023.

Typically, m-cap is the total value of a company's stock, derived by multiplying the stock price by the number of its outstanding shares.

Historically, the m-cap of NSE-listed companies surged from $2 trillion in July 2017 to $3 trillion in May 2021. This was in about 46 months. Similarly, the jump from $3 trillion to $4 trillion in December 2023 was registered in about 30 months.

In over a decade, the NIFTY 50 index has delivered 13.4% returns (Total price index CAGR). In a similar timeframe, domestic mutual fund assets under management (AUM) for equity and debt surged by 506% from ₹ 9.45 lakh crore in April-end 2014 to ₹ 57.26 lakh crore as of April-end 2024.

Similarly, the foreign portfolio investors (FPIs) AUM for equity and debt spiked by 345% from ₹16.1 lakh crore in April-end 2014 to ₹ 71.6 lakh crore as of April-end 2024.

Incidentally, the surge in m-cap is not restricted to the top companies alone but is observed across stocks.

The constituents of the NIFTY 100 index now account for 61% of market capital as compared to 74.9% of total market capital as of April 2014.

Also, liquidity in the secondary market has improved substantially in the capital market segment. The equity segment’s daily average turnover has surged by more than 4.5 times from ₹ 17,818 crore in FY15 to ₹ 81,721 crore in FY24.