The combined market value of Indian listed companies crossed Rs 500 lakh crore for the first time on Thursday. While the Nifty 50 remains 6.8% below its January peak, new listings like Jio Platforms and the NSE boosted total market cap. Meanwhile, heavyweights like HDFC Bank and Infosys fell significantly.

The combined market value of companies listed in India crossed Rs 500 lakh crore for the first time on Thursday. The benchmark Nifty 50, however, is still some distance from its peak.

All-India market capitalisation closed at a record Rs 502.70 lakh crore on Nov. 5, according to BSE data, up Rs 8.28 lakh crore from the previous session. The Nifty ended the day at 24,536.60, about 6.8% below its record close of 26,328.55 on January 2.

On that day, when the Nifty last closed at a peak, all-India market cap stood at Rs 482.02 lakh crore. Since then, the listed universe has gained Rs 20.69 lakh crore, or 4.3%, while the index has lost nearly 7%.

Three factors explain the divergence.

Two Mega Listings

The bulk of the increase comes from two companies that were not listed in January.

Jio Platforms debuted on Oct. 28 after raising Rs 30,213 crore in India's largest IPO. It ended Thursday with a market value of Rs 13.06 lakh crore, which makes it the country's second most valuable company after its parent, Reliance Industries. The National Stock Exchange (NSE) listed on BSE on Sept. 24 and was worth Rs 4.69 lakh crore at Thursday's close.

Together, the two account for Rs 17.75 lakh crore, roughly 86% of the market-cap gain since Jan. 2. Neither is a Nifty 50 constituent, so their value counts towards market capitalisation but does nothing for the index.

They are the biggest names in a much wider listing wave. BSE's all-India data now covers 6,202 companies, against 5,912 on Jan. 2. In September alone there were a record 70 IPO listings, according to SEBI's monthly bulletin: 32 on the mainboard, which raised Rs 40,355 crore, and 38 on SME platforms.

Heavyweights Drag

The index has been held back by the stocks that carry the most weight in it. According to NSE closing prices, HDFC Bank has fallen 24% since Jan. 2. The two biggest IT companies have done worse or nearly as badly, with Infosys down 29% and TCS down 23%. ITC has lost 20%, Reliance Industries 17.5% and Hindustan Unilever 16%.

ICICI Bank, up 11%, and Bajaj Finance, up 8%, are among the few large names in the black. The Nifty IT index has fallen 14% over the same period.

BSE's data shows how much value has drained from the very top of the market. The ten most valuable listed companies were together worth Rs 101.89 lakh crore on Thursday. That is less than the Rs 103.86 lakh crore the top ten were worth on January 2, even though Jio Platforms has since joined the group at No. 2.

In its monthly review released on Nov. 3, Motilal Oswal Financial Services said that over the past 12 months largecaps “have fallen 10%, underperforming midcaps (-4% YoY) and smallcaps (flat YoY).”

Broader Market Held Up

Beyond the very top, the picture is healthier. Excluding the ten most valuable companies, the rest of the listed universe, which includes this year's new listings, was worth Rs 400.81 lakh crore on Thursday, up from Rs 378.16 lakh crore on Jan. 2.

Index data, which strips out the effect of new listings, tells a similar story. Since January 2, the Nifty Smallcap 250 has risen 4.4% and the Nifty Microcap 250 has climbed 10.1%, while the Nifty Midcap 150 is down a marginal 1.3%. The broadest gauge, the Nifty Total Market index, tracks 750 stocks and is only 3.1% below its January record. That is less than half the Nifty 50's drawdown.

Thursday's session pointed the same way. “Improving participation beyond the frontline indices lent the move greater credibility,” Vinod Nair, head of research at Geojit Investments, said in a note. He added that the rally's staying power would depend on whether market breadth holds.