NSE Announces Changes to Index Maintenance Guidelines; from March 31

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The National Stock Exchange (NSE) on Tuesday revised the guidelines, criteria and methodology for maintaining the index. The changes will take effect on March 31, 2021. “The index maintenance (equity) subcommittee of NSE Indices Limited has decided to make changes,” he said in a statement.

According to the new directive, the replacement of shares resulting from the periodic reconstitution of the index will be implemented from the last working day (start of the day) of March, June, September and December depending on the revision frequency applicable to every clue. Currently, it is implemented from the first business day after the expiration of the March, June, September and December F&O

In the event of capped indices, the capping of stocks will be implemented from the last working day of March, June, September and December, taking into account the closing prices as on the T-3 basis, where T day is the last working day of March, June, September and December. It is currently implemented from the first business day after the expiration of the March, June, September and December F&O taking into account closing prices on a T-5 basis.

A quarterly rebalancing of the investable equities and weights will be implemented from the last business day of March, June, September and December. Currently, it is from the first business day after the F&O expiration of March, June, September and December.

The calculation of the price / earnings ratio of the indices will be modified. The price / earnings ratio (P / E ratio) will be calculated taking into account the profits (including profits and losses) declared by each constituent of the index during the last 4 quarters. (consolidated financial statements). In the event that consolidated financial data is not available, autonomous financial data for the last 4 quarters will be taken into account.

The dividend yield percentage for the indices will be calculated taking into account the total stock dividend of each company over 12 rolling months (calculated on the basis of the ex-dividend date).

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