BSE: Modification of the S&P BSE SENDEX Next 50 Methodology

NOTICE

Notice No.

20221014-16

Date of notice

October 14, 2022

Category

Index

Segment

Equity

Matter

Modification of the S&P BSE SENDEX Next 50 Methodology

Contents

Title of my page

Modification of the S&P BSE SENDEX Next 50 Methodology

BOMBAI, OCTOBER 14, 2022: Asia Index Private Limited (“AIPL”) announces the following methodology change for the S&P BSE SENDEX Next 50.

Methodology

Selection of constituents and weightings

Previous

Constituent selection.

All companies included in the S&P BSE 100 that are not included in the S&P BSE SENSEX 50 are selected and form the index, subject to the following derivative market linkage constraints:

?The individual float-adjusted weighting of any class of shares of a non-derivatives trading company may not exceed 5% of the index.

?The aggregate free float-adjusted weighting of the non-derivatives trading related constituents of the index may not exceed 20%.

If any of the above derivatives market linkage constraints are violated, the lowest ranked company not related to derivatives trading is removed and replaced by the highest ranked eligible company related to derivatives trading. This process is repeated until the aggregate weighting of the index components not related to derivatives trading no longer violates the constraints described above.


Methodology

Selection of constituents and weightings

Updated

Constituent selection.

All companies included in the S&P BSE 100 that are not included in the S&P BSE SENSEX 50 are selected and form the index, subject to the following derivative market linkage constraints:

?The individual float-adjusted weighting of any class of shares of a non-derivatives trading company may not exceed 5% of the index.

?The aggregate free float-adjusted weighting of the non-derivatives trading related constituents of the index may not exceed 20%.

If any of the derivative market linkage constraints above are not met, the following easing steps are applied in order to comply with these criteria.

1.If the individual float-adjusted weight of a class of shares of a company not involved in derivatives trading exceeds 5%, the stock is not considered for index selection and the best following eligible stock is selected in the S&P BSE SENSEX Next 50 and, consequently, in the S&P ESB 100.

2.If, after step 1, the overall float-adjusted weight of the non-derivatives trading related index constituents exceeds 20%, the lowest ranked non-derivatives trading company is removed and replaced by the highest ranked eligible company related to derivatives trading in the S&P BSE SENSEX Next 50 and therefore in the S&P BSE 100. This process is repeated until the aggregate weight of the non-trading related index components of derived products no longer violates the constraints described above.

3.Steps 1 and 2 are repeated iteratively to ensure that these two constraints are met

When rebalancing the index, if a stock was not considered for selection due to the derivatives market linkage rule and relaxation steps set out above, it will not be considered. for selection in the index only if it has derivative contracts.

For more information on all eligibility and selection criteria, please see S&P BSE index methodology.

IMPLEMENTATION TIMETABLE

This change will be implemented in conjunction with the December 2022 rebalancing, which takes effect before the market opens on Monday, December 19, 2022. Changes will first be visible to customers in pro forma files from Friday, December 2, 2022.

Please note the S&P BSE Indices methodology available on the AIPL website (www.asiaindex.co.in) is being updated to reflect this change.

Please contact customer service at [email protected]for any questions or requests for additional information.

For more information on the S&P BSE indices, please visit www.asiaindex.co.in

About ASIA INDEX PRIVATE LIMITED

Index Asia Pvt. Ltd is an equal partnership between S&P Dow Jones Indices LLC, the world’s largest provider of financial market indices, and BSE Ltd, Asia’s oldest stock exchange and home of the iconic SENSEX Index, a leading indicator of the performance of the Indian stock market. Index Asia Pvt. Ltd, which combines the credentials, market insights and knowledge of the two parent companies, each established over 115 years ago, aims to provide a comprehensive range of indices enabling global and domestic investors to participate in dynamic economies of South Asia. The company is best known for calculating, publishing and maintaining a diverse family of Asian indices under the umbrella brand S&P BSE Indices.

About BSE

BSE (formerly Bombay Stock Exchange) established in 1875, is Asia’s first stock exchange and now the fastest in the world with a speed of 6 microseconds. BSE is India’s leading stock exchange group and has played a leading role in the development of the Indian capital market. BSE is an incorporated and demutualized entity, with a broad shareholder base which includes the world’s leading stock exchange – Deutsche Bourse, as a strategic partner. BSE provides an efficient and transparent marketplace for trading in equities, debt instruments, equity derivatives, currency derivatives, commodity derivatives, interest rate derivatives, mutual funds and stock lending and borrowing.

BSE also has a platform dedicated to trading shares of small and medium-sized enterprises (SMEs) which is very successful. BSE also has a dedicated MF distribution platform BSE Star MF which is the largest mutual fund distribution infrastructure in India. BSE launched derivatives trading in gold, silver, copper, Oman crude oil, guar gum, guar seeds and turmeric.

BSE provides a host of other services to capital market participants, including risk management, clearing, settlement, market data services and education. It has a global reach with customers around the world and a nationwide presence. BSE’s systems and processes are designed to preserve market integrity, drive growth in the Indian capital market, and drive innovation and competition in all market segments.

Indian Clearing Corporation Limited, a wholly owned subsidiary of BSE, acts as the central counterparty for all trades executed on the BSE trading platform and provides full novation, guaranteeing settlement of all bona fide trades executed. BSE Institute Ltd, another wholly owned subsidiary of BSE, operates one of the most respected financial markets education institutes in the country. Central Depository Services Ltd. (CDSL), an associate company of BSE, is one of the two custodians in India.

BSE established an Investor Protection Fund (IPF) on July 10, 1986 to respond to claims by investors against defaulting members, in accordance with guidelines issued by the Ministry of Finance, Government of India. The BSE Investor Protection Fund is responsible for educating the investor community in India about capital markets.

About the S&P DOW JONES INDICES

S&P Dow Jones Indices is the world’s largest resource for essential index-based concepts, data and research, and is home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®. More assets are invested in products based on our indices than in products based on indices of any other provider in the world. Since Charles Dow invented the first index in 1884, S&P DJI has innovated and developed indices across the spectrum of asset classes helping to define how investors measure and trade the markets.

S&P Dow Jones Indices is a division of S&P Global (NYSE: SPGI), which provides essential information for individuals, businesses and governments to make decisions with confidence. For more information, visit www.spglobal.com/spdji.

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October 14, 2022

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