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S&P CNX Nifty is a well-diversified 50 stock index accounting for 22 sectors of the economy.

It is used for a variety of purposes such as benchmarking fund portfolios, index based derivatives, structured products, ETFs and index funds. S&P CNX Nifty is based upon solid economic research and is well respected internationally as a pioneering effort in better understanding how to make a stock market index. Highlights S&P CNX Nifty is owned and managed by India Index Services and Products Ltd. (IISL), which is a joint venture between NSE and CRISIL. IISL is India’s first specialized company focused upon the index as a core product. IISL has a licensing and marketing agreement with Standard and Poor’s (S&P), who are world leaders in index services.

Market Representation S&P CNX Nifty stocks represent about 65.57% of the total free float market capitalization of the universe of the stocks traded on NSE as on March 30, 2012.

Diversification: S&P CNX Nifty is a diversified index, accurately reflecting overall market conditions. The rewardto-risk ratio of S&P CNX Nifty is higher than other leading indices, making it a more attractive portfolio hence offering similar returns, but at lesser risk.

Liquidity Market impact cost is the best measure of the liquidity of a stock. It accurately reflects the costs faced when actually trading an index. For a stock to qualify for possible inclusion into the S&P CNX Nifty, it has to reliably have market impact cost of below 0.50 % when doing S&P CNX Nifty trades of Rs. 20 million.

Eligibility Criteria for Selection of Constituent Stocks The constituents and the criteria for the selection judge the effectiveness of the index. S&P CNX Nifty is unique in this respect.

Selection of the index set is based on 3 criteria: • • • Liquidity Floating Stock Others

For inclusion in the index, the security should have traded at an average impact cost of 0.50% or less during the last six months for 90% of the observations, for the basket size of Rs. 20 Million. Impact cost is cost of executing a transaction in a security in proportion to the weightage of its market capitalization as against the index market capitalization at any point of time. This is the percentage mark up suffered while buying / selling the desired quantity of a security compared to its ideal price = (best buy + best sell) /2 Floating Stock The companies eligible for inclusion in the S&P CNX Nifty Index should have free float of at least 10%. Free float factor (Investible Weight Factor–IWF) for each company in the index will be determined based on the public shareholding of the companies as disclosed in the shareholding pattern submitted to the stock exchanges by these companies on a quarterly basis. Promoters’ holding, government holding in case of public sector undertaking, shares held by promoters through ADRs/ GDRs, associate companies, employee welfare trusts, strategic stakes by corporate bodies, investments under Foreign Direct Investment (FDI) category (where identifiable) and public lock-ins are subtracted to arrive at Free Float factor. Others A company which comes out with an IPO will be eligible for inclusion in the index, if it fulfills the normal eligibility criteria for the index like impact cost, market capitalization and free float, for a 3 month period.

Method of Computation S&P CNX Nifty is computed using free float market capitalization method, wherein the level of the index reflects the total free float market value of all the stocks in the index relative to a particular base market capitalization value. The method also takes into account constituent changes in the index and importantly corporate actions such as stock splits, rights, new issue of shares etc. without affecting the index value.

Base Date and Value The base period selected for S&P CNX Nifty index is the close of prices on November 3, 1995, which marks the completion of one year of operations. The value of the index has been set at 1000 and a base capital of Rs.2.06 trillion.

Index Governance A professional team at IISL, a company setup by NSE and CRISIL manages S&P CNX Nifty. There is a three-tier governance structure comprising the Board of Directors of IISL, the Index Policy Committee, and the Index Maintenance Sub-Committee.

Index Performance

7000 6000

Index Value

5000 4000 3000 2000 1000 0

Nov-95

Jun-96

Jan-97

Aug-97

Dec-99

Jul-00

Sep-01

Nov-02

Jun-03

Jan-04

Aug-04

Sep-05

Nov-06

Jul-07

Jan-08

Sep-08

Nov-09

Jun-10

Jan-11

May-99

May-06

Aug-11

Mar-98

Oct-98

Feb-01

Apr-02

Mar-05

Apr-09

Date

Statistics:

Period Returns (%) 1 year -9.23 3 years 75.29 5 years 38.57 10 years 368.82 Since Inception 429.56 * As on March 30, 2012

Volatility (%) 1.29 1.46 1.87 1.66 1.69

Avg. Daily Return (%) -0.03 0.09 0.04 0.08 0.05

Mar-12

Sector Break-up: Mkt. Cap. * Rs. Cr. Banks 312358 Computers - Software 231961 Refineries 135698 Cigarettes 122289 Finance - Housing 99334 Automobiles - 4 Wheelers 98088 Engineering 70381 Power 66836 Pharmaceuticals 66352 Oil Exploration/Production 59684 Steel And Steel Products 58370 Telecommunication - Services 46002 Cement And Cement Products 42198 Automobiles - 2 And 3 Wheelers 42142 Diversified 42082 Mining 29315 Electrical Equipment 26777 Gas 16901 Aluminium 16643 Construction 16570 Financial Institution 16485 Metals 15591 Total 1632058 * Free Float Market Capitalization as on March 30, 2012 Industry Sr. No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Weight (%) 19.14 14.21 8.31 7.49 6.09 6.01 4.31 4.10 4.07 3.66 3.58 2.82 2.59 2.58 2.58 1.80 1.64 1.04 1.02 1.02 1.01 0.96 100.00

Company Size (Rs. Cr.) Largest Smallest Average As on March 30, 2012 138194 5522 32641

S&P CNX Nifty Constituents: Mkt. Cap. * Rs. Cr. 138194 126650 122289 102586 99334 93629 70381 59299 54042 48124 47482 42082 40427 32098 31739 29555 22529 22487 22258 21722 21416 21109 20801 20316 20237 19613 17866 16901 16643 16527 16485 16336 15591 15482 15311

Company Name Infosys Ltd. Reliance Industries Ltd. I T C Ltd. Housing Development Finance Corporation Ltd. ICICI Bank Ltd. HDFC Bank Ltd. Tata Consultancy Services Ltd. Larsen & Toubro Ltd. Hindustan Unilever Ltd. State Bank of India Bharti Airtel Ltd. Oil & Natural Gas Corporation Ltd. Mahindra & Mahindra Ltd. Tata Motors Ltd. Tata Steel Ltd. Bajaj Auto Ltd. Axis Bank Ltd. NTPC Ltd. Wipro Ltd. Dr. Reddy's Laboratories Ltd. Coal India Ltd. Bharat Heavy Electricals Ltd. Sun Pharmaceutical Industries Ltd. Hero MotoCorp Ltd. Jindal Steel & Power Ltd. GAIL (India) Ltd. Cipla Ltd. Kotak Mahindra Bank Ltd. Grasim Industries Ltd. Hindalco Industries Ltd. Power Grid Corporation of India Ltd. Tata Power Co. Ltd. Sterlite Industries (India) Ltd. Maruti Suzuki India Ltd. Ambuja Cements Ltd.

Weight (%) 8.47 7.76 7.49 6.29 6.09 5.74 4.31 3.63 3.31 2.95 2.91 2.58 2.48 1.97 1.94 1.81 1.38 1.38 1.36 1.33 1.31 1.29 1.27 1.24 1.24 1.20 1.09 1.04 1.02 1.01 1.01 1.00 0.96 0.95 0.94

Cairn India Ltd. 12985 Infrastructure Development Finance Co. Ltd. 12686 ACC Ltd. 12308 Punjab National Bank 12202 HCL Technologies Ltd. 11981 DLF Ltd. 9237 Sesa Goa Ltd. 9048 Ranbaxy Laboratories Ltd. 7954 Bharat Petroleum Corporation Ltd. 7593 Jaiprakash Associates Ltd. 7333 Siemens Ltd. 7196 Steel Authority of India Ltd. 6461 Reliance Communications Ltd. 6434 Reliance Infrastructure Ltd. 5575 Reliance Power Ltd. 5522 Total 1632058 * Free Float Market Capitalization as on March 30, 2012

0.80 0.78 0.75 0.75 0.73 0.57 0.55 0.49 0.47 0.45 0.44 0.40 0.39 0.34 0.34 100.00