Internet platform companies like Zomato and Naukri.com (Naukri.com) have not been able to participate in NSE’s benchmark Nifty-50 this time despite huge market capitalization. However, in the coming days, their claim is looking very strong. Nifty-50 includes top 50 companies out of 1600 companies traded on NSE. Some new companies will be included in the top companies next month, but Zomato and Naukri.com’s parent company Info Edge will not be included. However, ICICI Direct has said that the next time whenever new companies are included, then the claim of Info Edge will be strong. Zomato’s prospects are also looking very good. ICICI Direct’s report states that these companies with huge market capitalization and without promoter holding are strong contenders to make a place in Nifty-50.
Why Info Edge’s stock could not find a place in Nifty-50
Info Edge’s average free-float market capitalization is less than IndianOil’s free-float market capitalization. Indian Oil is the smallest company included in Nifty-50 in this respect. According to the rule, any share will get a chance to be included in Nify-50 i.e. Top 50 companies only if the average free-float market capitalization of this company is one and a half times the average market capitalization of the smallest company involved. This is where the Info Edge is looking behind. According to the way the index is prepared, the investible weight factor i.e. IWF depends on how many shares are available for trade in the market. These shares should be free-float i.e. they should not be entitled to any such shareholder who has a strategic interest in the company. Apart from these things, the entry of shares in Nifty 50 is determined by its average market capitalization in the last six months. According to this, Ifo Edge is the biggest contender to be included in Nifty-50 next time.
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How strong is Zomato’s claim?
Zomato will also emerge stronger in the next few days as a contender for Nifty-50. The three companies that can be included in the index at this time. They include Info Edge, Radhakrishna Damani’s Avenue Supermarket (DMart) and Gautam Adani’s Adani Green Energy. These are new economy companies. One is an internet platform, another is grocery e-retail and the third is a green energy company. Currently DMart and Adani Green Energy could not join Nifty-50 as it was not a part of Future & Option (F&O).
ICICI Direct says that the inclusion of stocks in Nifty-50 shows which sector is going to increase demand in the economy in the long run.