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Sectors In The Stock Market That You Should Know | Beginner’s Guide To The Stock Market | Module 5

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Sectors In The Stock Market That You Should Know | Beginner’s Guide To The Stock Market | Module 5

There are various sectors in the stock market. A sector is a group of companies that performs similar business operations. For example, let us consider the IT sector, this sector includes companies that make software or companies that provide Internet-related services. TCS, Infosys, Wipro, etc. are the top IT companies that belong to the IT sector.

TOP 10 SECTORS IN THE STOCK MARKET

There are a lot of sectors that are present in the stock market, and in today’s article, we are going to take a look at the Top 10 Sectors of the Indian Stock market.

Following are the main sectors of the Indian stock market-

  • Finance
  • Energy
  • Information Technology
  • Communication
  • Fast Moving consumer goods
  • Automobile
  • Pharmaceutical
  • Metal
  • Infrastructure
  • Media

Now, let us know about these sectors in detail-

•Finance

It is the major sector in the stock market that includes commercial banks, insurance companies, non-banking financial companies, co-operatives, pension funds, mutual funds, and other smaller financial entities. India is having a diversified financial sector with strong growth of existing financial firms and new institutions entering into the business. As finance is the most important part of the economy, it is the most sensitive sector.

HDFC Bank, SBI, Bajaj Finance, Axis Bank, Muthoot Finance, etc. These are the major companies that belong to the finance sector.

•Energy

The energy sector is nothing but a group of companies that produce or supply energy. This sector mainly includes companies that perform the operation of exploration and development of oil or gas reserves, oil and gas drilling, and refining.

The revenue generated by this sector often fluctuates because it depends upon the price of natural gas, crude oil, and other commodities. Reliance Industries Limited, Power Grid Corporation of India, Oil & Natural Gas Corporation Ltd., NTPC Ltd., Bharat Petroleum Corp. Ltd., etc. These are the major companies present in Indian Stock Exchanges that belong to the energy sector.

•Information Technology

As we discussed earlier, this sector mainly includes the companies which make software or companies that provide Internet-related services. IT sector is also one of the biggest sectors on the Indian Stock Exchange.

Companies in this sector provide various services such as manufacturing of electronics, creation of software, computers, or products and services relating to information technology. TCS, Infosys, Wipro, Tech Mahindra, HCL Tech, etc are the major companies of the IT sector.

• Communication

This sector includes companies that perform the operation of transmission of data through words, voice, audio, or video across the globe or the companies that offer telecom equipment or telecom-related services. This sector is an integral part of the Indian Economy as it simplifies and fastens the process of communication.

Bharti Airtel, Vodafone Idea LTD, Indus Towers LTD., etc. These are the major telecommunication companies.

•Fast Moving Consumer Goods (FMCG)

This sector consists of a group of companies that produce packaged goods, i.e., goods that are produced, distributed, marketed, and consumed within a short period. FMCG sector is the 4th largest sector in the Indian Economy which comes under essential services.

Hindustan Unilever, Britannia Industries, Nestle, ITC, Dabur India, etc. These are the major companies that belong to the FMCG sector.

·Automobile

The automobile sector consists of companies involved in the development, design, manufacturing, and selling of motor vehicles. It is one of the biggest sectors in the Indian stock market by revenue.

Maruti Suzuki, Tata Motors, Mahindra & Mahindra, Hero MotoCorp, etc. are the major companies of the automobile sector.

·Pharmaceutical

The Pharma sector comprises companies involved in manufacturing medicines, vaccines, and other pharmaceutical drugs for use as medications. It is one of the most important sectors of the Indian economy because India is the largest provider of different vaccines used to prevent different diseases. India supplies over 50% of the global demands of various vaccines.

Sun Pharmaceutical, Divi’s Laboratories, Cipla Ltd, Lupin, etc. are the major companies in the pharma sector.

·Metal

The metal sector consists of companies involved in the extraction of metal and mineral reserves. Generally, metals are classified into two types; precious metals and industrial metals. Industrial metals are used in construction, manufacturing, and technology industries. Examples of industrial metals are zinc, iron, steel, aluminium, etc.

Precious metals are limited in supply and have a great value associated with them. Gold, silver, and platinum are examples of precious metals.

Tata Steel, JSW Steel, Hindustan Zinc, Hindalco are examples of major companies in the metal sector.

·Infrastructure

The infra sector consists of companies involved in the development of power, bridges, dams, roads, and urban infrastructure development. This sector plays an important role when it comes to the overall development of the Indian Economy.

Larsen & Toubro Infrastructure Development Projects Limited, GMR Infrastructure Limited, Adani Port, and Special Economic Zone Limited are the major companies in the infrastructure sector.

·Media

The media sector consists of many different segments such as television, print, and films.

Zee Entertainment Enterprises, Sun TV Network, PVR Ltd are the major companies in the media sector.

Here is the donut chart of all the important sectors that are the major part of the Nifty50 index by their weightage-

 

Sectors In The Stock Market

 

These are the important sectors in the Indian stock market. By using these sectors, there are various indices present to track the performance of the particular sector. In case you don’t know about stock market indices, then you can check our previous blog of the series, “Best Beginner’s Guide to the Stock Market | Module 4 | 3 Important Factors That Differentiates Large Cap, Mid Cap, And Small Cap Companies”

I hope in today’s article, I was able to explain to you about the top 10 sectors in the stock market. If you have any queries regarding this topic, please post them in the comment section.

4 Comments

  1. Namastey Anish sir I am your big fan…aap meri Hero ho..main apka booming bulls ki har ak video dekhti hoon…sir main apka course karna chahti hoon..lekin sir mera paas itna paisa filhal nehi hain…sir dusra koi upai hain???

    1. Thank you, Maninder, glad that you find the blog helpful. We constantly try to bring helpful blogs for our traders and will continue doing so.

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