NSE's Market Cap Soars 21% to ₹438 Lakh Crore: A Defining Moment in 2024

A Record-Breaking Year for the Indian Stock Market

The year 2024 will be remembered as a historic chapter in the evolution of the Indian stock market. The National Stock Exchange (NSE) achieved unprecedented milestones, including a remarkable 21% year-on-year (YoY) growth in market capitalization. From a value of ₹361.05 lakh crore ($4.34 trillion) on December 29, 2023, the market cap soared to ₹438.9 lakh crore ($5.13 trillion) by December 31, 2024.

This phenomenal growth reflects not just the resilience of the Indian economy but also the increasing participation and confidence of investors in the market. Here’s a detailed look at what made 2024 a landmark year.

IPO Boom: Mainboard and SME Companies Take Center Stage

The Indian market saw a flurry of Initial Public Offerings (IPOs) in 2024, with 301 companies listing on the NSE. This includes:

• 90 Mainboard Companies: These raised a staggering ₹1.59 lakh crore, with an average IPO size of ₹1,772 crore.

• 178 SME Companies: Collectively, these raised ₹7,348 crore, with an average IPO size of ₹41 crore.

• 33 Direct Listings: Adding further diversity to the market landscape.

Key IPO Highlights

• Largest Mainboard IPO: Hyundai Motor India, which raised ₹27,859 crore, dominated the headlines as the year’s largest offering.

• Smallest Mainboard IPO: Vibhor Steel Tubes, with an issue size of ₹72 crore, showcased the diversity in scale.

• Largest SME IPO: Danish Power led the SME category, raising ₹198 crore.

• Smallest SME IPO: HOAC Foods India Ltd, with an issue size of just ₹6 crore, underscored the growing opportunities for smaller players.

These IPOs not only provided companies with critical growth capital but also offered investors a broader spectrum of investment opportunities.

Nifty50 and Benchmark Indices: Stellar Performances

2024 saw strong performances across the NSE indices, with benchmarks achieving robust growth.

• Nifty50 Performance: The flagship index gained 8.8% over the year, closing at 23,645 on December 31, 2024, compared to 21,731 a year earlier.

• Top Performers Among Indices:

  • Nifty Next 50: Delivered a remarkable return of 27.4%, highlighting the potential in emerging large-cap companies.

  • Nifty Smallcap 50: Posted an impressive 25.3% growth, reflecting the resilience and growth potential of smaller companies.

  • Nifty Midcap 50: Achieved a solid return of 21.5%, showcasing robust midcap performance.

These returns underline the broad-based recovery and growth across market segments, attracting both domestic and global investors.

Market Cap-to-GDP Ratio: A Leap in Market Confidence

One of the most striking metrics of 2024 was the NSE’s market cap-to-GDP ratio, which surged to 145% on December 31, 2024, from 117% at the end of 2023. This represents a significant 29% increase, indicating the growing integration of the stock market with the broader economy.

This ratio, often used as a barometer of market valuation, underscores the increasing depth and maturity of India’s financial markets.

The Drivers Behind 2024’s Success

Several factors contributed to the Indian stock market’s stellar performance in 2024:

1. Robust Economic Growth: A resilient economy supported strong corporate earnings and investor sentiment.

2. Favorable Policy Environment: Pro-growth government policies and regulatory initiatives boosted market confidence.

3. Increased Retail Participation: Growing financial literacy and easier access to investment platforms led to higher retail investor activity.

4. Global Tailwinds: Improved global economic conditions and a favorable export environment provided additional support.

Looking Ahead: What 2025 Could Hold

As the curtain closes on 2024, the Indian stock market is poised for further growth in 2025. Key areas to watch include:

• The continuation of the IPO boom, with more companies expected to tap into the public markets.

• Sustained growth in midcap and smallcap segments as the broader economic recovery deepens.

• Innovations in technology and fintech, further democratizing market access for retail investors.

• Evolving global economic dynamics and their impact on Indian exports and capital flows.

A Year of Transformation

The year 2024 was transformative for the Indian stock market, setting new benchmarks in market cap, IPO activity, and index performance. The market’s evolution not only reflects the strength of the Indian economy but also its potential to be a global investment destination.

As we move into 2025, the momentum gained in 2024 provides a strong foundation for continued growth and innovation in the Indian financial ecosystem. Whether you're a seasoned investor or a newcomer, 2024’s milestones offer valuable insights and inspiration for the journey ahead.