BSE IPO

BSE SME IPO Index Share Price

On the Bombay Stock Exchange (BSE), the BSE SME IPO is a strategy index. It records the performance of a certain subset of small and medium-sized businesses (SMEs) following their listing on the BSE SME platform, or following the conclusion of their IPO. It is the only index in India that has monitored the performance of recently listed SMEs for more than a year. 

Sector Wise Representation of BSE SME IPO Index

A diverse index of forty-three equities covering twelve sectors—Healthcare, Housing Related, Capital Goods, Consumer Durables, FMCG, Chemical & Petrochemical, Tourism, IT, Finance, Oil & Gas, Media & Publishing, and Metal, Metal Products & Mining—makes up the S&P BSE SME IPO index.

History of BSE SME IPO Index

Launched on December 14, 2012, the S&P BSE IPO index had a base value of 100 and a first value date of August 16, 2012. The share price of the S&P BSE India IPO has surpassed 12,000 at about 29.82x P/E multiples since its launch.

Management of BSE SME IPO Index

The S&P BSE Index Committee, established under Asia Index Private Ltd., a joint venture between S&P and BSE Ltd., is responsible for overseeing and managing the S&P BSE SME IPO index. The BSE SME IPO index is computed in USD and INR using spot foreign exchange rates derived from Refinitiv data for the USD.

BSE SME IPO Stocks Selection Criteria

The BSE SME IPO index stocks must fulfill the following criteria to be included in this index: 

1. The company should be domiciled in India and newly listed on the BSE SME platform. 
2. Should have a minimum post-issue capital of ₹1 crore, not exceeding ₹25 crores, to be eligible for inclusion on the BSE SME platform. 
3. Company should be included on the second day of its listing. 
4. The company should be excluded from the index after being listed for one year. 
5. It should have a minimum number of 10 stocks at all times; in case there is a shortfall, the company stock’s exclusion is delayed till a new eligible stock can be found.
6. The company should only include common stocks of the SME IPO companies.
7. Public issues that are not resolved are not eligible to be included in the index.
8. Even if the stock hasn't finished a full year of listing on the BSE SME platform, it should be removed from the index on the day the index stock migrates from the BSE SME platform to the BSE Mainboard platform.

How is BSE SME IPO Value Calculated?

The BSE live IPO value is calculated as follows –

Index value = Index Market Value / Divisor

Where,

Index Market Value = Price * Shares * IWF (Float Factor)

Market Value after rebalancing / Index Value before rebalancing is the divisor following rebalancing.

Every month on the Monday that follows the third Friday of the month, the BSE SME IPO index is reconstituted.

Should you invest in the BSE SME IPO index?

The S&P BSE SME IPO index's performance varies annually due to market fluctuations as well as periodic changes to its composition, which include the removal of companies that cease operations after a year and the addition of companies that satisfy eligibility requirements. The BSE SME IPO index has given exceptional price appreciation of 53.68% in the last 5 years and 91.46% in the last 3 years. The returns are on the current index constituents and hence may be a bit erratic.