Pharmaceuticals sector is one of the key sectors where Indian companies have created a global brand for themselves besides software. Indian companies have taken advantage of the opportunities in the regulated generics market in the western countries and made deep inroads especially in providing low cost equivalents of expensive drugs. Pharma outsourcing into India and low cost Healthcare services are expected to be the key areas of growth in the near future. In addition, the inherent potential of biotechnology has also attracted many new companies and this is also a key growth area for Indian companies. IISL has developed CNX Pharma Index to capture the performance of the companies in this sector.

Methodology

Effective October, 11, 2010, CNX Pharma Index is computed using free float market capitalization weighted 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 period. The method also takes into account constituent changes in the index and importantly corporate actions such as stock splits, rights, etc without affecting the index value. The CNX Pharma Index has a base date as Jan. 01, 2001 and a base value of 1000.


Market Representation

• The CNX Pharma Index represents about 4.45% of the free float market capitalization of the stocks listed on NSE and 80.09% of the free float market capitalization of the stocks forming part of the Pharmaceutical sector universe as on December 30, 2011.
  
  

• The total traded value for the last six months of all Index constituents is approximately 2.55% of the traded value of all stocks on NSE and 66.69% of the traded value of the stocks forming part of the Pharmaceutical sector universe.
   

Selection Criteria

Selection of the index set is based on the following criteria :

1. Company's market capitalisation rank in the universe should be less than 500



2. Company's turnover rank in the universe should be less than 500



3. Company's trading frequency should be at least 90% in the last one year.



4. Company should have a minimum track record of 3 years of operations with a positive networth.



5. A company, which comes out with an IPO, will be eligible for inclusion in the index, if it fulfills the normal eligiblity criteria for the index for a 3 month period instead of a 6 month period.

*CNX Pharma Index was computed using market capitalization weighted method from the launch date till October 08, 2010.

List of CNX Pharma Index Stocks