What does BeES stand for in Nifty BeES?

BeES stands for Benchmark Exchange Traded Scheme. The fund was originally launched in January 2002 by Benchmark Asset Management — India's first ETF provider. Benchmark AMC was later acquired by Reliance Mutual Fund in 2011, and subsequently rebranded to Nippon India Mutual Fund in 2019. The full name of the fund today is Nippon India ETF Nifty 50 BeES, but it is still widely known simply as Nifty BeES.

Is Nifty BeES the same as a Nifty 50 index mutual fund?

Both track the Nifty 50, but they work differently. Nifty BeES is an ETF that trades on the NSE in real time during market hours — you buy and sell units like shares. A Nifty 50 index mutual fund is bought/sold at end-of-day NAV directly through the AMC or platforms like MF Central. ETFs are slightly cheaper (expense ratio ~0.04%) and require a demat account. Index funds support SIP without a demat account. For long-term SIP investors without a demat account, an index fund is more convenient. For active or lump-sum investors with a demat account, Nifty BeES offers more flexibility.

What Is Nifty BeES? India's First ETF. How It Works & Returns

What Is Nifty BeES? India's First ETF Explained. How It Works, Returns & Tax

Nifty BeES tracks the Nifty 50 with an expense ratio of just ~0.04%. Here's how it works, what returns it has delivered, and the tax rules that apply after the Finance Act 2024.

Revati Krishna

Published: 10 Jun 2026, 05:00 PM IST (2 days ago)

Last Updated: 10 Jun 2026, 05:50 PM IST (2 days ago)

6 min read

Quick Answer

Nifty BeES (Nippon India ETF Nifty 50 BeES) is India's first exchange-traded fund, launched in 2002. It tracks the Nifty 50 index, the 50 largest companies on the NSE with a very low expense ratio of around 0.04%. You buy and sell units on the stock exchange through a demat account, just like shares. One unit is priced at approximately 1/100th of the Nifty 50 index value.

India had mutual funds for decades before Nifty BeES arrived. But in January 2002, Benchmark Asset Management launched something new: an index fund that trades on the stock exchange like a stock. That product, now called Nippon India ETF Nifty 50 BeES, changed how retail investors could access the Indian market. Over two decades later, it remains one of the most widely held ETFs in the country.

What is Nifty BeES?

Nifty BeES stands for Nifty Benchmark Exchange Traded Scheme. It is a passively managed ETF that replicates the Nifty 50 index, buying the same 50 stocks in the same weights as the Nifty 50 composition. The fund is managed by Nippon India Mutual Fund (formerly Reliance Mutual Fund, which acquired Benchmark AMC in 2011).

Key details:

NSE ticker: NIFTYBEES
Benchmark: Nifty 50 Total Return Index
Expense ratio: ~0.04% per year
AUM: approximately ₹25,000–30,000 crore
Unit price: roughly 1/100th of Nifty 50 level (so if Nifty is at 24,000, one unit ≈ ₹240)
Launched: January 8, 2002 — India's first ETF

How does Nifty BeES work?

The fund manager holds shares of all 50 Nifty companies in the exact same proportion as the index. When Nifty rebalances (adds or removes a stock), the ETF adjusts its portfolio accordingly.

When you buy a unit of Nifty BeES, you are effectively buying a small slice of all 50 companies — HDFC Bank, Reliance, Infosys, TCS, ICICI Bank, and 45 others — in one transaction. This gives you instant diversification across India's largest companies across sectors: banking, IT, oil and gas, consumer goods, infrastructure, and more.

Nifty BeES vs other Nifty 50 ETFs

ETF Name	AMC	AUM (approx.)
Nippon India ETF Nifty 50 BeES	Nippon India MF	~₹62,000 Cr
HDFC Nifty 50 ETF	HDFC MF	~₹5,200 Cr
SBI Nifty 50 ETF	SBI MF	~₹2,00,000 Cr
ICICI Pru Nifty 50 ETF	ICICI Prudential MF	~₹40,000 Cr
UTI Nifty 50 ETF	UTI MF	~₹69,000 Cr

Note: Expense ratios and AUM are approximate. SBI Nifty ETF's large AUM reflects institutional/EPFO investments. For retail investors, all these ETFs deliver similar returns, the difference is mainly liquidity and bid-ask spreads.

Historical returns of Nifty BeES

Since Nifty BeES tracks the Nifty 50 index, its returns closely mirror the index (minus the expense ratio). The Nifty 50 has delivered approximately:

Period	Nifty 50 CAGR (approx.)
1 year	-6.7%
3 years	~28.3%
5 years	~50.8%
Since inception (2002)	~2437.3%

(Returns are as of 10th June.)

Note: Returns are before tax and vary based on entry and exit points. Past performance is not a guarantee of future returns. Always check the fund's current fact sheet for up-to-date NAV and returns data.

Nifty BeES vs Nifty 50 index fund (regular mutual fund)

Both track the Nifty 50, but there are practical differences:

Liquidity: Nifty BeES trades on the exchange in real time. Index funds are bought/sold at end-of-day NAV.
Minimum investment: Nifty BeES: 1 unit (~₹240).
SIP: Most brokers don't support SIP in ETFs directly. Index funds support automatic SIP.
Expense ratio: ETFs are slightly cheaper (0.04–0.07% vs. 0.10–0.15% for direct index funds).
Demat account: ETFs require a demat account; index funds don't.

If you want to invest regularly in small amounts via SIP without a demat account, a Nifty 50 index fund is more convenient. If you want to trade intraday, want the lowest cost, or already have a demat account, Nifty BeES is a good choice.

Tax on Nifty BeES — Finance Act 2024 rules

Nifty BeES is treated as an equity ETF for taxation purposes. The Finance Act 2024 (effective July 23, 2024) updated the rates:

Holding period for LTCG: 12 months (unchanged).
LTCG tax rate: 12.5% on gains above ₹1.25 lakh per year.
STCG tax rate: 20% (increased from 15%) — applies if held for less than 12 months.
STT: Securities Transaction Tax applies on both buy and sell.

The key takeaway: hold Nifty BeES for at least 12 months to qualify for LTCG treatment. Under LTCG, gains up to ₹1.25 lakh in a financial year are completely exempt — so smaller investors often pay no tax at all.