BAJAJ FINSERV ASSET MANAGEMENT LIMITED.
The Nifty Next 50 index tracks companies positioned immediately below the Nifty 50 within the Nifty 100 universe. This index offers exposure to businesses that have the potential to enter the Nifty 50 over time based on changes in market rankings. These companies sit between large cap giants and mid cap companies, forming a segment of India’s equity market with its own risk and return characteristics.
Includes companies that are relatively well-traded and investible
Access to companies with the potential to become future market leaders
The index combines the relative stability of large companies with exposure to companies that still have room to grow
Exposure to a broad mix of sectors and business models
The Nifty Next 50 is a broad-based equity index that forms part of India’s large cap segment. It consists of 50 companies drawn from the Nifty 100 after excluding the Nifty 50 constituents. These companies are selected based on defined eligibility criteria and are weighted by free-float market capitalisation. The index spans multiple sectors, offering representation across diverse areas of the economy. It follows a rule-based methodology and undergoes periodic reviews to reflect changes in market capitalisation and eligibility. As a result, the index evolves over time in line with broader market movements and structural shifts.
The Nifty 50 is India’s flagship equity index, representing the country’s most established and actively traded large cap companies. Although both Nifty 50 and Nifty Next 50 are large cap indices, they differ in composition and behaviour.
Bajaj Finserv AMC offers index funds tracking both indices – Bajaj Finserv Nifty 50 Index Fund and Bajaj Finserv Nifty Next 50 Index Fund – enabling investors to choose which is suitable for their needs. To read more about the Bajaj Finserv Nifty 50 Index Fund and access statutory details, click here. For scheme and statutory information about Bajaj Finserv Nifty Next 50 Index Fund, click here.
Let’s look at the differences between the Nifty 50 and the Nifty Next 50.
The Nifty 50 includes the top 50 companies in the Nifty 100 universe. The Nifty Next 50 includes the remaining 50 companies after excluding the Nifty 50 constituents.
The Nifty 50 largely represents established market leaders. The Nifty Next 50 represents large cap companies that may still be scaling operations.
The Nifty Next 50 has the potential to offer slightly higher returns than the Nifty 50, with relatively higher volatility as well.
Exposure to potential leaders
The index comprises growing companies and has historically been a stepping stone to the Nifty 50.Past performance may or may not be sustained in future.
Cost effective
As a passive fund, it has lower expense ratios than actively managed funds, which can make it relatively cost-effective in the long run.
Simplicity
Follows a rule-based strategy by investing in Nifty 50 constituent companies in line with index weights, without active stock selection.
Valuations
Current valuations of the Nifty Next 50 Index are below long-term averages. The 10-year average PE ratio is approximately 31.35 while the PE ratio as on March 30, 2026, is 17.09. Source: NSE Indices, Data as on March 30, 2026.
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The Nifty Next 50 index is a free-float market capitalisation–weighted index comprising the next 50 largest companies by market cap on the National Stock Exchange after the Nifty 50. Together, the Nifty 50 and the Nifty Next 50 form the Nifty 100.
The index tracks liquid and actively traded large cap companies that are positioned just below the top tier of the Indian equity market, as defined by NSE Indices methodology.
The list of companies included in the Nifty Next 50 index is published by NSE Indices and is subject to change during periodic reviews. As of March 30, 2026, the Top 10 constituents of the Nifty Next 50 are:
| Company Name | Weight (%) |
| Vedanta Ltd. | 5.20 |
| Hindustan Aeronautics Ltd. | 3.86 |
| TVS Motor Company Ltd. | 3.70 |
| Divi’s Laboratories Ltd. | 3.54 |
| Hindustan Aeronautics Ltd. | 3.09 |
| Britannia Industries Ltd. | 2.99 |
| Tata Power Co. Ltd. | 2.97 |
| Adani Power Ltd. | 2.91 |
| Cummins India Ltd. | 2.84 |
| Avenue Supermarts Ltd. | 2.72 |
Source: Nifty Next 50 Factsheet, NSE Indices. Data as on March 30, 2026. Please refer the exchange website for the exhaustive list of Nifty Next 50 Companies.
Please note that the reference to any industry/sector/stock is provided for illustrative purposes only. This should not be construed as a research report or a recommendation to buy or sell any security or sector.
Stock selection for the Nifty Next 50 index follows a rules-based process, which includes:
• Selecting companies from the Nifty 100 universe
• Excluding the constituents of the Nifty 50
• Reflecting eligibility conditions applicable to Nifty 100 constituents
• Conducting semi-annual reviews to rebalance the index
These rules are defined and maintained by NSE Indices.
The index is calculated using the free-float market capitalisation method:
Index Value = (Current Free-Float Market Capitalisation / Base Free-Float Market Capitalisation) × Base Index Value
This means that price movements of larger-weighted companies have a proportionately greater impact on the overall index level.
Investors cannot invest directly in the Nifty Next 50 index. Exposure is typically obtained through index mutual fund schemes or exchange traded funds (ETFs) that track the index.
Index funds and ETFs are passively managed mutual funds that replicate the portfolio of their benchmark index and seek to mirror its performance (subject to tracking error). The main difference between the two is that ETFs are listed on stock exchanges and can be traded throughout the business day (like stocks), whereas index funds, like other mutual funds, can only be bought and sold based on their end-of-day Net Asset Value or NAV.
Allocation to such funds depends on an investor’s risk tolerance, investment horizon, and overall asset allocation. Exposure to the Nifty Next 50 index is generally considered as a long-term allocation rather than for short-term positioning.
Systematic Investment Plans may be used to spread investments over time. This approach may help manage timing risk, though it does not remove market risk.
Several factors may influence index performance, including:
● Changes in corporate earnings
● Shifts in sector allocation within the index
● Macroeconomic conditions
● Periodic index rebalancing that adds or removes constituents
Some commonly cited characteristics include:
● Exposure to expanding companies that have the potential to make their way into the Nifty 50 over time.
● Diversification beyond the top 50 large cap stocks
● Transparent and rules-based index construction
However, returns from the Nifty Next 50 index may fluctuate more sharply during adverse market phases compared to the Nifty 50, reflecting higher volatility.
Retail investors typically access the Nifty Next 50 through:
● Index mutual fund schemes tracking the Nifty Next 50
● ETFs designed to replicate the Nifty Next 50
The index includes 50 companies ranked immediately after the Nifty 50. Constituents are reviewed regularly and may change periodically.
Sector composition varies over time and is published by NSE Indices. As on March 30, 2026, financial services had the highest weight in the portfolio (21.19%), followed by capital goods (16.37%) and fast-moving consumer goods (8.98%).
Source: Nifty Next 50 Factsheet, NSE Indices. Data as on March 30, 2026. Please refer the exchange website for the exhaustive list of Nifty Next 50 Companies.
Please note that the reference to any industry/sector/stock is provided for illustrative purposes only. This should not be construed as a research report or a recommendation to buy or sell any security or sector.
Exposure is typically obtained through index mutual funds or ETFs.
The index follows a free-float market capitalisation methodology, consistent with NSE Indices construction principles.
No. The Nifty Next 50 is classified as a large cap index, although its constituents are in the lower end of the large cap spectrum.
Yes, the Nifty Next 50 index is reviewed semi-annually. During these reviews, companies may be added or removed depending on their relative ranking and continued fulfilment of index requirements.
It refers to investing in an index mutual fund designed to replicate the performance of the Nifty Next 50 index, subject to tracking error.
A Nifty Next 50 mutual fund is a type of index mutual fund that mirrors the index composition and performance, aligning with passive investment principles
The calculator alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy. This tool is created to explain basic financial / investment related concepts to investors. The tool is created for helping the investor take an informed investment decision and is not an investment process in itself. Bajaj Finserv AMC has tied up with AdvisorKhoj for integrating the calculator to the website. Mutual Fund does not provide guaranteed returns. Also, there is no assurance about the accuracy of the calculator. Past performance may or may not be sustained in future, and the same may not provide a basis for comparison with other investments. Investors are advised to seek professional advice from financial, tax and legal advisor before investing in mutual funds.
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Bajaj Finserv Limited, an unregistered Core Investment Company (CIC) under RBI Regulations 2020, is a part of the renowned Bajaj Group.
One of India’s leading and most diversified financial services institutions, Bajaj Finserv Ltd provides simple financial solutions to crores of people every day through its group companies. Through continuous innovation, it strives to enrich the lives of communities across the length and breadth of the country and make financial security accessible to all.
Our Investment Philosophy reflects what we, as an organisation, believe will generate a good return on equity investment for our investors in the long term. It dictates our goals and guides decision making.
Alpha (a) is a term used in investing to describe an investment strategy’s ability to beat the market.
Alpha is thus also often referred to as excess return or the abnormal rate of return in relation to a benchmark, when adjusted for risk. Essentially, it means doing better than the crowd without taking disproportionate risk.
Collecting superior information
Analysts and portfolio managers strive to collect superior information about the business and the management of the company. They try to generate superior earnings forecast and the balance strength of the company and the industry, thereby trying to 'beat the market' on information edge. This is an important source of alpha for an investor. However, over the years, retaining the information edge has become more difficult and expensive. With a whole lot of investors trying to collect superior information, how can an investor be sure to continuously have accurate and material information about the companies, ahead of others, all the time?
Processing information better
Even if you don't have material information earlier than the crowd, you can still generate better outcomes if you are able to process this information better. Investors develop models and algorithms with enhanced predictive powers to forecast the next move. Fund managers who invest based on some pure formal analytical models are quantitative managers. Here, the goal is to try and beat other investors based on the sophistication of procedures or analytics. The analytical edge can be quite useful until it gets copied by many, and then it may stop generating superior returns.
Exploiting behavioural biases
As the name suggests, this edge is achieved by superior behaviour in reacting to the inputs available to maximise alpha. Modern finance assumes people behave with extreme rationality. However, researchers in behavioural finance have shown that this is not true. Moreover, these deviations from rationality are often systematic. Behavioural managers try to exploit situations where securities are mispriced by the market because of behavioural factors. At Bajaj Finserv AMC, we endeavour to combine the best of these edges.
