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Our Bureau

Mumbai, Aug. 25 Standard & Poor’s has launched an index, which the rating agency said is designed to provide global investors tradeable exposure to the Indian equity markets.

The new “S&P India Select Index” comprises 60 leading Indian companies that will meet size and liquidity requirements for tradeability, with no single stock carrying more than a 10 per cent weightage in the index, said a news release from S&P.

“The new S&P India Select Index was developed in response to growing investor demand for access to the leading companies in India,” said the release.

The index is fully float adjusted, and stock weights are determined by what is legally and practically available to foreign investors. Stocks that have reached the maximum percentage holding for FIIs are excluded from the index, to reflect the lack of access of those stocks to foreign investors.

The index has a pool of easily accessible underlying stocks that provides a unique way for international investors to take part in India’s growth story, said Mr R. Ravimohan, Managing Director and Head of Standard & Poor’s, South and Southeast Asia.

The eligibility requirements for a stock are that they must first be constituents of the S&P/IFCI India Index, which is designed to measure the type of returns foreign portfolio investors might receive from investing in emerging market stocks that are legally and practically available to them.

The stocks must be trading on NSE. In addition to that, the companies must have a float-adjusted market capitalisation above $500 million and a three-month average daily trading value above $2 million.

Sectors represented in the S&P India Select Index include telecommunications, consumer staples, utilities, financials, energy, materials, industrials, information technology and healthcare. The top 10 holdings by percentage of index weight are Infosys Technologies, Bharti Airtel, Oil and Natural Gas Corporation, Reliance Communications, Housing Development Finance, Reliance Industries, ICICI Bank, Hindustan Lever, Bharat Heavy Electricals, and Larsen & Toubro Ltd.

The Index will be rebalanced twice a year in April and October.

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