Nifty Financial Services Index Falls 0.38% to 27,775; HDFC Bank, ICICI Bank Hold Over 52% Weight

The Nifty Financial Services Index measures the performance of India’s financial sector. It includes major banks, housing finance companies, insurance firms, NBFCs and other financial service providers. In total, the index consists of 20 NSE-listed companies that represent the core of the country’s financial ecosystem.

Key Uses of the Index

Investors and fund houses use this index for several purposes:

• Benchmarking mutual fund portfolios
• Launching index funds and ETFs
• Creating structured financial products

Fundamental Metrics

Fundamental Indicators

• Dividend Yield: 1.11
• P/E Ratio: 18.2
• P/B Ratio: 2.91 
  These numbers reflect valuation levels across the financial sector.

Risk Indicators

• Standard Deviation: 17.49 (1 year)
• Correlation with Nifty 50: 0.90
• Beta: 0.93 

The high correlation shows the sector moves closely with broader markets but slightly less volatile.

Top Constituents by Weightage

The Nifty Financial Services Index is largely dominated by major banking stocks, making it highly aligned with movements in the banking sector. HDFC Bank leads the index with a weight of 31.76%, followed by ICICI Bank at 20.46%. State Bank of India holds 8.38%, while Axis Bank and Kotak Mahindra Bank contribute 7.56% and 6.45% respectively.

Latest Market Performance

The index closed at 27,775.25, marking a decline of 106.65 points or 0.38% compared to the previous close of 27,881.90. During the session, the index moved within a range of 27,733.65 to 27,863.70. Trading activity remained high with a volume of 380.41 lakh shares and a total traded value of ₹4,145.64 crore. Over the past year, the index has fluctuated between a low of 22,320.85 and a high of 28,065.50, indicating strong overall market momentum despite short-term pullbacks.

Returns Overview

The Nifty Financial Services Index showed a slight weekly decline of 0.13%, but the broader trend remains positive. Over the past month, it gained 1.98%, while the three-month return stands at a strong 7.07%. The six-month performance shows a moderate gain of 3.46%, and the year-to-date return is an impressive 17.60%. Over the last year, the index rose 12.44%, and its long-term performance is even more robust, delivering 43.98% in three years and 93.10% over five years. This shows that the financial sector continues to be a strong wealth-compounding segment in the Indian market.

Read More: Exato Technologies Shares List at ₹266 on BSE SME After Strong IPO Demand.

Top Gainers and Losers

Among the top performers of the day, BSE led with a gain of 0.76%, closing at ₹2,837.40. HDFC Life also saw positive momentum, rising 0.51% to ₹772.20. SBI Life recorded a mild increase of 0.23%, while ICICI Prudential Life edged up 0.14% to ₹626.95.

On the downside, REC Ltd. was the biggest loser of the day, falling 2.31% to ₹345.15. PFC followed with a drop of 2.03%, closing at ₹345.50. LIC Housing Finance also declined 1.88% to ₹531.60. Jio Financial Services slipped 1.84% to ₹298.15, while Bajaj Finance declined 1.72% to ₹1,030.00.

Conclusion

The Nifty Financial Services Index provides a clear picture of India’s financial sector performance. With heavy weightage to major banks and strong long-term returns, the index remains a key benchmark for both investors and fund managers.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.