BSE Teck

S&P BSE TECk Index

The Bombay Stock Exchange's (BSE) value-weighted sectoral index, BSE TECk, represents the performance and behaviour of the country's technology industry. According to the BSE's industry classification methodology, it is a diversified index comprising 28 firms from the S&P BSE 500 index that cover the IT (81.45%), Telecommunications (15.31%), and Media & Publishing (3.25%) sectors.

History of S&P BSE TECk Index

Launched on July 11, 2001, the S&P BSE TECk index had a base value of 1000 and a first value date of January 31, 2000. The S&P BSE TECk share price has surpassed 13,000 at about 33.14x P/E multiples since its launch. The BSE TECk index has a weighted average carbon intensity of approximately 29.76.

How is S&P BSE TECk calculated? 

The value of the S&P BSE TECk index is determined in real-time using a free-float market capitalization-weighted method. It is reconstituted in June and December on a semi-annual basis. INR and USD are the two currencies used to create the BSE TECk index; spot foreign exchange rates for USD are derived from data provided by Refinitiv. S&P BSE TECk TR is an index variation of it.

How are Stocks Selected in S&P BSE TECk?

For the securities to be a part of the BSE TECk index, they need to meet the following eligibility requirements: 

• The company should be listed on the Bombay Stock Exchange with headquarters in India.
• It should be included in the S&P BSE 500 index.
• It should be included in the BSE Sector Classification Systems technology sector.
• There should be ten or more constituents in each sector (IT, Media & Publishing, Telecom) that account for at least 90% of the average free-float market capitalization. Even if the number of constituent stocks drops below 10, this minimum market coverage of 90% shall be upheld.
• It must have traded at least 90% of the time over the six months prior.
• Company has to reduce index turnover, a 2% buffer for inclusion and exclusion should be kept in place.
• Every quarter, if a stock's sector classification changes between rebalancing, it is removed from the index.
• To be considered for inclusion, companies that have launched initial public offerings (IPOs) must rank in the top 10 and have a listing history of at least one month.
• Businesses that undergo mergers, delistings, takeovers, suspensions, objections to surveillance, bankruptcies, or graded surveillance measures (GRM) may be omitted from consideration between the rebalancing dates. 

Should You Invest in BSE TECK?

The BSE TECk index has shown outstanding annualized price returns over the last 10 years, averaging 14.51% and 18.6% in the last five. Over a five-year period, its annualized risk-adjusted returns ratio is 1.06; over a ten-year term, it drops to 0.89. Its levels of volatility are often comparable to those of the BSE 500 index. The estimated multiples for BSE TECk are 2.01% dividend yield and around 25x P/E.