S&P Dow Jones Indices today announced that effective from the December 23, 2013 (after the market close of December 20, 2013), Sri Lanka Telecom PLC (CSE Ticker: SLT, Bloomberg Ticker: SLTL SL) and Aitken Spence Hotel Holdings PLC(CSE Ticker: AHUN, Bloomberg Ticker: AHUN SL) will be removed from the S&P Sri Lanka 20 index as they no longer qualify for index inclusion. Replacements will be Lanka Orix Leasing Co PLC (CSE Ticker: LOLC, Bloomberg Ticker: LOLC SL) and The Lion Brewery Ceylon PLC (CSE Ticker: LION, Bloomberg Ticker: LION SL).
The index includes the largest 20 stocks, by total market capitalization, listed on the CSE that meet minimum size, liquidity and financial viability thresholds. The constituents are weighted by float-adjusted market capitalization, subject to a single stock cap of 15%, which is employed to reduce single stock concentration.
The S&P Sri Lanka 20 has been designed in accordance with international practices and standards. All stocks are classified according to the Global Industry Classification Standard (GICS®), which was co-developed by S&P Dow Jones Indices and MCSI and is widely used by market participants throughout the world.
Rajeeva Bandaranaike, Chief Executive Officer of Colombo Stock Exchange commented: "Having launched the Index in June 2012, I am happy to see that the S&P Sri Lanka 20 index has gained acceptance among stakeholders. Since the index is designed to be used for index linked trading products the acceptance it has gained is important. I am confident that the index will further enhance the visibility of our market among the global investor community."
To be eligible for inclusion, a stock must have a minimum float-adjusted market capitalization of 500 million Sri Lankan rupees (Rs), a six-month average daily value traded of Rs 1 million, have been traded at least 10 days of each month for the three months prior to the rebalancing reference date, and have positive net income over the 12 months prior to the rebalancing reference date.