The Skindia GDR Index has announced drastic changes in the index. It has reduced the number of companies to 15 from 23, which represents the most actively traded depositary receipts (DRs).
With these changes, the index would now cover over 75 per cent of the market capitalisation of 72 DRs traded in London, Luxembourg and the US. The index committee of the Skindia GDR Index has announced modifications effective from June 7.
There has been no change in the methodology, which continues to use free float market capitalisation - the first index to employ this method since February 2000. On the review date, the weight of an individual company is restricted to 20 per cent of the index and the representation of an industry to 33 per cent.
Twelve companies have been removed from the index - BSES, EI Hotels, Finolex Cables, Grasim, Gujarat Ambuja, ICICI, Indian Hotels, IPCL, Mahindra & Mahindra, Pentamedia Graphics, Satyam Infoway and Telco. Five companies have been added -- Dr Reddy's Laboratories, HDFC Bank, ICICI Bank, Satyam Computers and Wipro.
Among the 10 companies that remain in the index, 6 got more weightage - Infosys (up 2.15 per cent to 7.94 per cent), ITC (up 1.95 per cent to 5.09 per cent), Reliance Industries (up 1.05 per cent to 12.05 per cent), Bajaj Auto (up 0.91 per cent to 1.60 per cent), State Bank of India (up 0.60 per cent to 7.58 per cent) and VSNL (up 0.41 per cent to 6.75 per cent). However, some of the companies now are getting reduced weightage -- Ranbaxy (down 2.98 per cent to 5.31 per cent), MTNL (down 1.45 per cent to 5.43 per cent), Larsen & Toubro (down 0.32 per cent to 2.16 per cent) and Hindalco (down 0.25 per cent to 6.46 per cent).
The top five companies in the index account for over 50 per cent of weightage -- ICICI Bank (15.41 per cent), Reliance (12.05 per cent), Dr Reddy's (10.28 per cent), Infosys (7.94 per cent) and State Bank of India (7.58 per cent).
The Skindia GDR Index closed at 510.67 on June 7. Its price-earning was 10.35 and its premium to local prices was 8.72 per cent. The index has gained 1.92 per cent since the beginning of the year and lost 18.83 per cent since its close on June 7, 2001. The New York-based Instanex Capital Inc owns the Skindia GDR Index, the oldest and most popular benchmark of Indian securities trading on foreign markets. The index is managed and distributed by Instanex Capital Consultants Pvt Ltd, Mumbai.
