The Shanghai Stock Exchange (SSE) and China Securities Index Co., Ltd. (CSI) have recently announced that the SSE 380 Index would be officially launched on November 29, 2010, with the base day on December 31, 2003 and the base point at 1,000 points.
After more than two decades of development, a multi-layer capital market featured with big-cap blue chips and boasting joint growth of small, medium and large sized enterprises has taken shape in Shanghai. Moreover, the ever-improving SSE index system, which at present covers such series as scale, sector, style, strategy and theme, provides investors with tools to analyze the SSE-listed companies in a multi-level and multi-angle manner. To adapt to the SSE's development strategy of blue-chip market, better reflect the market structure and its development, and enrich the SSE index system, the SSE and CSI plan to release the SSE 380 Index.
Different from the SSE 180 Index which focuses on traditional big-cap blue chips in finance, energy, material and industry sectors, the SSE 380 Index puts its spotlight on emerging growing blue chips to mirror the overall performance of an array of medium-sized listed companies with great growth potential and strong profitability which are not traditional blue chips. Most of these companies are in their rapid growth phase or early part of maturity stage and in energy-saving and environmental protection, new-generation information technology, biology, high-end equipment, new energy, new material and other emerging industries and consumption sectors. As they indicate the strategic direction of national economic development and the direction of economic restructuring, they are usually called emerging blue-chip companies. The SSE 380 Index, SSE 180 Index and SSE 50 Index will jointly constitute the major blue-chip indices of Shanghai market.
The constituents of SSE 380 Index are made up of top 380 companies in terms of their operating revenue growth rate, return on net assets, turnover and total market capitalization excluding the constituents of the SSE 180 Index and those firms whose undistributed profit is negative and which fail to distribute cash dividend or bonus shares in the last five years, with the number of listed companies in each secondary industry determined in the principle of industry matching. This particular compilation method not only considers the growth, profitability, scale and liquidity of the stocks but also highlights the industrial status of the stocks, thus ensuring the characters of blue chips with great growth potential of the constituents.
According to the latest statistics, the total and free float market capitalization and daily average trading volume of the constituents of SSE 380 Index have reached RMB3.22 trillion, RMB1.67 trillion and RMB48.7 billion, accounting for 16.22%, 25.29% and 33.2% of the total of all SSE-listed stocks, respectively. SSE 380 Index stands for 73% market capitalization and 61% turnover of the Shanghai stock market excluding that of the constituents of SSE 180 Index.
Regarding industrial distribution, the constituents of SSE 380 Index covers 21 out of all 25 secondary industries, with no stocks selected from the four secondary industries of telecom, banking, insurance and comprehensive finance. With a relatively balanced industrial distribution, the top three industries are capital goods, raw material and pharmacy, and biotechnology and life science, with the weights of 24.23%, 18.73% and 9.33%, respectively.Historical data showed that SSE 380 Index embodied the high evaluation feature as high growth stocks, with the accumulative yield from 2004 to 2010 hitting 277% and the latest P/E ratio at 35.8.
For compilation methodology and more information of SSE 380 Index, please refer to the website of the SSE (www.sse.com.cn) and the website of CSI (www.csindex.com.cn).