State of Indian Stock Markets – August 2017

This is the August 2017 update for the State of Indian Stock Markets.

As usual, this monthly update includes historical analysis and Heat Maps of Nifty50 as well as Nifty500‘s key ratios, namely P/E, P/BV ratios and Dividend Yield.

Please remember that these numbers are averages of P/E, P/BV and Dividend Yield in each month. Neither Nifty50 heat maps nor Nifty500 heat maps show the maximum or the minimum values for each month.

Caution – Never make any investment decision based on just one or two ‘average’ indicators (Why?) At most, treat these heat maps as broad indicators of market sentiments and a reference of market’s historical mood swings.

So here are the Nifty 50 Heat Maps…

Historical P/E Ratios – Nifty 50 (Monthly Average)

Historical Nifty PE 2017 August

P/E Ratio (on last day of August 2017): 25.62
P/E Ratio (on last day of July 2017): 25.69

Historical P/BV Ratios – Nifty 50 (Monthly Average)

Historical Nifty Book Value 2017 August

P/BV Ratio (on last day of August 2017): 3.49
P/BV Ratio (on last day of July 2017): 3.51

Historical Dividend Yield – Nifty 50 (Monthly Average)

Historical Nifty Dividend Yield 2017 August

Dividend Yield (on last day of August 2017): 0.94%
Dividend Yield (on last day of July 2017): 0.95%

Now, to the historical analysis of Nifty500 companies…

As the name suggests, Nifty500 is made up of top 500 companies which represent about 95% of the free float market capitalization of the stocks listed on NSE (March 2017).

Nifty50 on other hand is an index of 50 of the largest and most frequently traded stocks on NSE. These represent about 63% of the free float market capitalization of the NSE listed stocks (March 2017).

So obviously, Nifty500 is comparatively a much broader index than Nifty50.

Historical P/E Ratios – Nifty 500 (Monthly Average)

Historical Nifty 500 PE 2017 August

P/E Ratio (on last day of August 2017): 29.63
P/E Ratio (on last day of July 2017): 29.33

Historical P/BV Ratios – Nifty 500 (Monthly Average)

Historical Nifty 500 Book Value 2017 August

P/BV Ratio (on last day of August 2017): 3.32
P/BV Ratio (on last day of July 2017): 3.35

Historical Dividend Yield – Nifty 500 (Monthly Average)

Historical Nifty 500 Dividend Yield 2017 August

Dividend Yield (on last day of August 2017): 0.89%
Dividend Yield (on last day of July 2017): 0.91%

You can read the last month’s update here. The State of Markets section has also been updated with new Nifty heat maps (link).

For a detailed analysis of how much returns you can expect depending on when the investments have been made (at various P/E, P/BV and Dividend Yield levels), please have a look at these 3 posts:

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Written by Dev Ashish

Founder - Stable Investor Investing | Personal Finance | Financial Planning | Common Sense

5 comments

  1. Hi Dev,

    Thanks for the chart – Nifty 500 has not been this high since 2000!

    What would you suggest be done by a passive investor who does not currently have the time or knowledge to actively stock pick – continue with the SIPs in this scenario or put a pause on monthly investment and invest in equity once PE has fallen a bit (invest the amount in debt funds for the meantime)?

    The goal is for early retirement (about 10 years away)

    Thanks!

  2. Sir, Thanks for this public service of making this little gem of a tool, NIFTY-50 Heat Map. I have written a blog post about predicting the market fall using this tool.

    Thanks!

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