NSE Introduces Nifty500 Ahimsa Index With 326 Ethically Screened Stocks

NSE Indices, a subsidiary of the National Stock Exchange (NSE), introduced the Nifty500 Ahimsa Index, a new thematic benchmark that tracks 326 companies from the Nifty 500 universe whose businesses meet animal welfare-focused investment criteria.

Developed with the Ahimsagain Foundation, the index is intended for investors who want exposure to listed companies that follow the principles of Ahimsa, or non-violence, without giving up diversified equity exposure.

The index has been back-tested with 1 April 2016 as its base date and a starting value of 1,000. Data released by NSE Indices showed it delivered a compound annual growth rate (CAGR) of 15.11% since inception. The five-year CAGR stands at 13.09%, while the total return over the past year was down 0.98%.

What Makes A Company Eligible?

To decide which companies make the cut, NSE Indices has relied on the Ahimsa Investment Movement (AIM) framework developed by the Ahimsagain Foundation. The framework looks at a company's products, services, and overall business activities before assigning it to one of three categories: Green, Orange, or Red.

Only companies that receive a Green rating are included in the index. Firms placed in the Orange or Red categories are excluded from the benchmark.

The index will be reviewed every six months. Stock weights will also be recalculated during the review based on each company's free-float market capitalisation.

Auto, IT, And Capital Goods Lead The Basket

Automobile & auto components make up the biggest portion of the index with a weight of 13.05%. Capital goods follows at 12.20%, while information technology (IT) accounts for 11.80%. Financial services represents another 10.35%.

Bharti Airtel is the largest constituent with a weight of 6.01%. Infosys, Mahindra & Mahindra, Tata Consultancy Services, and Maruti Suzuki India complete the top five holdings.

NSE Indices said the benchmark has been created to offer a transparent, rules-based option for investors looking to combine ethical investing in India with broad market participation. It also expects the index to serve as the basis for passive products such as exchange-traded funds (ETFs), index funds, and other structured investment products in the future.

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