India now has its first stock market index that tracks the success of firms in the electric car ecosystem. NSE Indices Ltd, the National Stock Exchange’s index services division, introduced a new thematic index, the Nifty EV & New Age Automotive Index.
The index will monitor the performance of enterprises active in the electric ecosystem or producing electric cars or new-age automotive vehicles based on hybrid technology and hydrogen fuel.
Stocks in the larger Nifty 500 index are eligible to be included in the index if they manufacture and provide electric or new-generation automotive cars, batteries, components, raw materials, andtechnology.
The index could act as a benchmark for asset managers and become a reference index tracked by passive funds in Exchange Traded Funds (ETFs), index funds and structured products. The base date for the index will be April 2, 2018, and the base value is 1000. The index will be reconstituted semi-annually and rebalanced quarterly.
Currently, the index has 33 stocks. Top constituents by weightage include Bajaj Auto, Tata Motors Ltd, Maruti Suzuki India Ltd, Mahindra & Mahindra Ltd, Exide Industries Ltd, Bosch Ltd, Samvardhana Motherson International Ltd, Eicher Motors Ltd, CG Power and Industrial Solutions Ltd and Himadri Speciality Chemical Ltd.
The launch of the Nifty EV & New Age Automotive index will facilitate the creation of products that would create an opportunity for asset managers to invest in the electric vehicle and new age automotive market thereby providing an investment vehicle to investors, said NSE Indices CEO Mukesh Agarwal said.
The new index launch comes at a time when the Indian government is pushing for the adoption of vehicles that run on batteries and alternate fuels. Electric vehicle adoption in India is picking up faster in the two and three-wheeler segments. As per the Vahan portal, a total of around 1.6 million (16 lakh) electric vehicles were sold in India during 2023-24, which includes 944,126 two-wheelers, 632,485 three-wheelers, 90,432 four-wheelers and 3,693 buses.
Electric two-wheeler major Ola Technologies is likely to list its shares on the stock exchanges soon, while Ather Energy and Hyundai Motor India are also reportedly planning for an initial public offerings. Tata Motors has announced a major restructuring plan that would demerge the company into two separate publicly traded companies – one for the commercial vehicle business and the other for the passenger vehicle business, which will be home to the company’s include electric vehicle business and Jaguar Land Rover as well.
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