The National Stock Exchange (NSE) on April 19, 2023, issued a notification regarding a revision in the methodology of nifty equity indices for handling corporate actions involving demergers.
The Index Maintenance Sub-Committee (Equity) of NSE Indices Limited had on November 18, 2022, announced a revision in the methodology of Nifty equity indices for the treatment of mergers.
As the approach earlier proposed in the market consultation paper for the treatment of demergers in Nifty equity indices required further deliberations with market participants and stock exchanges, etc., revision in the current treatment of demergers in Nifty equity indices was kept on hold.
Based on a study of global practices, and feedback received from the market participants, the Index Maintenance Sub-Committee (Equity) of NSE Indices Limited has decided to make revisions in the methodology of Nifty equity indices for the treatment of demergers as mentioned in the document.
The change shall be applicable to the scheme of arrangement of all companies involving demergers which may be approved by equity shareholders of respective companies on or after April 30, 2023.
