National stock exchange of India (NSE)

Topic Covered in this page

National stock exchange is one of the leading stock exchanges in India. It is located in Mumbai, India. It was established in 1992, as a first fully automated stock exchange in the country. Earlier, the trading membership was limited to the brokers but after its emergency the right to trade was given to all those who were having knowledge about the trade and met minimum financial requirements. The paper based settlement i.e. share certificate was replaced by the electronic depository based accounts.

It was set up by the leading financial institutions, insurance companies and banks.  National stock exchange was recognised as a stock exchange in April, 1993. The equity segment commenced in November, 1994 and the derivatives segment commenced in June, 2000.




National stock exchange of India

Objectives of national stock exchange

There are certain objectives of national stock exchange with which it was it up and they are as under:

  1. It was established for establishing a country wide trading facility so that a connection can be built with the investor base throughout the country for all types of securities.
  2. It has established an effective communication network so that the investors throughout the country get an equal access.
  3. It is an electronic trading securities system. The previous paper based securities exchange was not so up to the mark. Paper based transactions were not efficient because of the possibility of theft, and delay in transaction. The electronic system has improved the service and thus provides faster, safe and transparent transactions.
  4. It also enables the shorter settlement cycles.
  5. It was set up with the objective of meeting the international standards and the benchmarks.

Within this short span of time, national stock exchange of India has performed so well and has fulfilled the objectives for which it was set up. It has ensured that the service is provided to the investors at the lowest cost possible. It has removed all the geographical barriers and thus helped in improving the transparency in the transactions.




Market segment of National stock exchange (NSE)

There are two segments of national stock exchange. They are:

  1. Whole sale debt market segment: this segment deals with the securities that are – treasury bills, commercial paper, mutual funds, certificate of deposit, floating rate bonds, index bonds, zero coupon bonds, central government securities, state developmental loans, bonds of public sector undertakings (PSUs), and corporate debentures.
  2. Capital market segment: the capital market segment of national stock exchange is a platform which provides free, fair and transparent trade of the securities like – equity shares, exchange traded funds, debentures, preference shares and retail government securities.

NIFTY 50

The nifty 50 is a flagship index of the national stock exchange of India. It is an index wherein, the behaviour of the lue chip companies is tracked. Blue chip companies are those companies well established, nationally recognised and financially strong. There are approximately 1600 companies which are listed on the national stock exchange. Out of these 1600, top 50 are selected and their behaviour is measured. These companies keep on coming in the top list and going based on their performance in stock market.




As on June 2020, the nifty 50 companies are as under:

  1. GAIL Ltd.
  2. Wipro limited
  3. Reliance industries limited
  4. HCL technologies limited
  5. Sun pharmaceutical industries limited
  6. Oil and natural gas corporation limited
  7. Reddy’s laboratories limited
  8. Cipla limited
  9. Mahindra and Mahindra limited
  10. Industries limited
  11. Britannia industries limited
  12. Tata consultancy services limited
  13. Nestle India limited
  14. Infosys limited
  15. Vedanta limited
  16. Bharti infratel limited
  17. Hindustan unilever limited
  18. Ultratech cement limited
  19. Asian paints limited
  20. Tech Mahindra limited
  21. Adani ports and special economic zones limited
  22. Maruti suzuki India limited
  23. Shree cement limited
  24. UPL limited
  25. Bharti airtel limited
  26. Zee entertainment enterprise limited
  27. Coal India limited
  28. Bajaj auto limited
  29. Power grid corporation of India limited
  30. Hero motocorp limited
  31. Eicher motors limited
  32. Housing development finance corporation limited
  33. Kotak Mahindra bank limited
  34. Indian oil corporation limited
  35. JSW steel limited
  36. Larsen and toubro limited
  37. State bank of India
  38. Titan company limited
  39. HDFC bank limited
  40. Grasim industries limited
  41. ITC limited
  42. Bharat petroleum corporation limited
  43. Bajaj finserv limited
  44. Tata steel limited
  45. NTPC limited
  46. ICICI bank limited
  47. Bajaj finance limited
  48. Axis bank limited
  49. Tata motors limited
  50. IndusInd bank limited

National stock is thus one of the important stock exchanges of India. It has several objectives which it fulfils and is running keeping those objectives in check from past so many years. It has revolutionised the securities market of india. It has two main segments where the securities such as shares, debentures, bonds or government loans, commercial paper etc are dealt with. The national stock exchange of India also has flagship index where top 50 companies are recorded and tracked so that the information can be updated for the general public to make an informed decision. These 50 companies are not fixed but keep on changing time to time. Approximately 1600 companies are listed on the national stock exchange.

Share on whatsapp
Share on facebook
Share on twitter
Share on linkedin
Share on email

Leave a Comment