NIFTY IT TRI

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The NIFTY IT Total Returns Index (NIFTY IT TRI) is the dividend-reinvested variant of the NIFTY IT index, administered by NSE Indices Limited. The index tracks the 10 largest and most liquid information technology companies listed on the National Stock Exchange of India (NSE), encompassing India’s premier software services exporters, IT consulting companies, and digital transformation providers. It is among the most internationally linked of all sectoral Indian indices: the revenue and earnings of its constituents are predominantly denominated in US dollars and Euros, making the index sensitive to global technology spending cycles, the rupee-dollar exchange rate, and demand from US and European corporations.

Publisher and base data

  • Publisher: NSE Indices Limited
  • Base date: 1 January 1996
  • Base value: 1,000
  • Constituent count: 10

Constituents and concentration

With only 10 constituents, the NIFTY IT is a highly concentrated index. The top three or four companies typically account for 70-80% of total weight:

  • Tata Consultancy Services (TCS): consistently the largest constituent, often 25-35% of the index.
  • Infosys: typically 20-28%.
  • HCL Technologies: approximately 8-12%.
  • Wipro: approximately 7-10%.
  • Tech Mahindra, LTIMindtree, Mphasis, Coforge, Persistent Systems, OFSS (Oracle Financial Services): distributed across the remaining 20-30%.

The dominance of TCS and Infosys means the NIFTY IT TRI is substantially driven by the fortunes of these two companies.

Methodology

Free-float market capitalisation weighting is applied. Selection criteria include free-float market cap rank within the IT sector, minimum liquidity thresholds (impact cost and trading volume), and a minimum six-month NSE listing history. The index is reconstituted semi-annually.

Indian IT companies are notable for returning cash to shareholders through dividends and buybacks. The aggregate dividend yield of the NIFTY IT index has historically been in the range of 1.5-3.0% per annum, higher than many other sectoral indices. The TRI therefore incorporates a meaningful dividend reinvestment component, and the TRI-PRI gap is above average for a sectoral index.

Global revenue exposure

The NIFTY IT index’s global linkages make it unusual among Indian sectoral benchmarks:

  • US revenue share: approximately 55-65% of aggregate NIFTY IT constituent revenues come from North America, primarily the United States.
  • Europe: 25-30%.
  • India and rest of world: 10-20%.

This means the NIFTY IT TRI is materially affected by:

  1. Rupee-dollar exchange rate: INR depreciation against the USD boosts the INR value of export revenues, supporting earnings and equity valuations.
  2. US technology spending cycles: corporate IT budgets in the US and Europe drive revenue growth for Indian IT companies.
  3. NASSCOM and sector employment trends: aggregate sector hiring and utilisation rates signal near-term revenue momentum.
  4. US immigration and visa policy: restrictions on H-1B visas can raise onsite staffing costs for Indian IT exporters.

Historical returns

PeriodApproximate NIFTY IT TRI CAGR
1-year (FY2024-25)8-14%
3-year CAGR (2022-25)4-8%
5-year CAGR (2020-25)22-28%
10-year CAGR (2015-25)16-21%

The index experienced exceptional returns during 2020-22 as global digital transformation spending accelerated during and after the Covid-19 pandemic. Subsequently, the US Federal Reserve rate tightening cycle in 2022-23 triggered significant corporate IT budget reviews, leading to revenue growth deceleration and the sharp underperformance of the index in 2022-24 relative to the bull market peak of early 2022.

Mutual fund and ETF usage

The NIFTY IT TRI is the benchmark for:

  • Technology sector funds: examples include Tata Digital India Fund, Franklin India Technology Fund, ICICI Prudential Technology Fund, SBI Technology Opportunities Fund.
  • NIFTY IT ETFs: exchange-traded products tracking the index. Examples: Mirae Asset Nifty IT ETF, Kotak Nifty IT ETF.

SEBI classifies technology funds as sectoral/thematic, implying higher concentration risk than diversified funds. The global revenue exposure also adds foreign currency and geopolitical risk components not present in domestically oriented sector funds.

See also

References

  1. NSE Indices Limited. “NIFTY IT Index Methodology.” niftyindices.com. Accessed 2026.
  2. NSE Indices Limited. “NIFTY IT Fact Sheet.” niftyindices.com. 2025.
  3. NASSCOM. “IT Industry Annual Report 2024-25.” nasscom.in. 2025.
  4. SEBI. Circular SEBI/HO/IMD/DF3/CIR/P/2018/04 on TRI benchmarks.

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WebNotes Editorial Team

The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

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