The NSE’s index services subsidiary, NSE Indices Limited on Friday that it has launched India’s first ever Municipal Bond Index, Nifty India Municipal Bond Index at a SEBI workshop on Municipal Debt Securities at Bengaluru.
The Nifty India Municipal Bond Index tracks the performance of municipal bonds issued by Indian municipal corporations across maturities and having investment grade credit rating.
“The index includes municipal bonds issued as per the Securities Exchange Board of India Issue and Listing of Municipal Debt Securities Regulations, 2015. Presently, the index has 28 municipal bonds issued by 10 issuers all having credit rating in the AA rating category. The index constituents are assigned weights based on their outstanding amount,” the statement said.
The index is computed using the total return methodology including price return and coupon return. The index has a base date of January 01, 2021, and a base value of 1000, which will be reviewed quarterly. It is expected to act as a benchmark for asset managers and be a reference index tracked by passive funds in the form of Exchange Traded Funds (ETFs), index funds and structured products.
