Nifty Calculator Sep 2022 – A Bear Market Reversal or Bull Market ?

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For all the super bullish and bearish readers. 

Please send me a  guesstimate sheet which takes it to 15000/15500 and 18500/19000. 

 

This is a good time for exercise. Can mail me on nooreshtech@analyseindia.com

 

NIFTY CALCULATOR Sep 2022

Nifty Calculator Sep 2022

 

Do check this video on Nifty Calculator – https://www.youtube.com/watch?v=QbmhiLXYx2k

What is a Nifty Calculator?

-> As per the weightage given by NSE for Nifty stocks we have created the Nifty Calculator.

-> Change the expected price and the expected Nifty will change accordingly

-> Create 3 different sheets for yourself–

Pessimistic (where you put the worst possible prices you think. Default 10% down)

Optimistic (the best prices possible. Default 10% up)

Neutral/Rational/Technical / Fundamental (prices on any reasoning)

Please Note as weights change every day by a small margin this will not give an accurate estimate but will be approximate.

How to Guess?

  • Everyone has a view on Nifty based on Macro, PE, Valuations, Technicals, Waves, etc. Try to grill it down to the constituents. It should be a reflection of your actual guesstimate.
  • Just estimating wild scenarios on the top 20 stocks is enough given the 75-80% weight.
  • Start with changing the default fall to 5-10-15-20-40-80 or rise to 5-10-20-40-80.
  • Then change stocks that you think may not do the default move.
  • Also do remember there is not a direct correlation between the economy with the Nifty.

Things to Note

  • One of the reasons we keep posting this is to make an actual unbiased guess every month/quarter.
  • There have been numerous warnings as to how markets are overheated. Understanding the constituents allows you to realize how Nifty is not supposed to reflect the Economy.
  • Nifty is now at the middle from a recent low of 16747 and 18096 the highs.
  • Putting in the numbers looks like we are going to stay sideways for some time. What’s your call?

Interesting Observations

  • Top 5 stocks – Reliance, HDFC Bank, Infosys, ICICI Bank, HDFC = 39.37% vs 40.70% of Nifty in July 2022
  • Top 10 stocks constitute 56.96% vs 58.33% of the Nifty in July 2022
  • Top 20 stocks constitute 76.65% vs 77.30% of the Nifty in July 2022
  • Reliance is the top weight at 10.84%, followed by HDFC Bank at 8.27%19.11 % of the Index.
  • Reliance + HDFC Twins = 24.59% of Nifty (Hope you get why Nifty does not depict GDP. 25% of India’s GDP is not equal to Reliance +HDFC)
  • HDFC Twins together constitute 13.75% of Nifty (reducing now for some time)
  • Bottom 25 stocks have less than 1% weight and total weight at 17.69%

Sectoral Observations

Some changes in classification :

  1. Consumer goods sector is now divided into Consumer Durables and FMCG.
  2. ‘Oil and Gas’ now renamed as ‘Oil, Gas and consumable fuels’. Coal India now classified under Oil, Gas and Consumable fuels. Earlier it was classified under metals. IOC out from index which was classified under Oil and Gas
  3. ‘Automobile’ Sector renamed as ‘Automobile and Auto Components’.
  4. ‘Metals’ renamed as ‘Metals and Mining’. Coal India no longer classified under this sector.
  5. ‘Cement and  Cement Products’ sector renamed as ‘Construction Material’.
  6. ‘Pharma’ sector renamed as ‘Healthcare’ and Apollo hospital is included in the index under this sector.
  7. ‘Fertilizers and Pesticides’ sector renamed as ‘Chemicals’.

Weightage Changes

  • Banks and Financials  are now increasing from recent low of 35.19% in March 2022 to 36.81% now. It has seen a bottom of 33.16 in July 2020.
  • Power at just 1.96%. 
  • Media at 0.
  • Oil and Gas from 16.18% in July 2020 to 12.46%. ‘Oil and Gas’ is now renamed as ‘Oil, Gas and Consumable fuels’. Coal India is now classified under Oil, Gas, and Consumable fuels. Earlier it was classified under Metals. IOC out from the index which was classified under Oil and Gas.
  • Metals from 2.77% in July 2022 to 3.85% . Coal India is now classified under ‘Oil, Gas and Consumable Fuels’. Earlier it was under Metals.
  • IT weights increased from 14.48% in April 2020 to 19.09% in Dec 2021. Its weight reduced from 19.09% in December 2021 to 13.82% in Sep 2022.
  • Automobile sees an increase after a long time. Now at 5.83%
  • Consumer Durables weight increased from 2.93 to 3.43%
  • Healthcareat 4.06% – Highest weight compared to previous months

Thank you for reading the article


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