BHB to adopt GICS for listed companies
TDT | Manama
The Daily Tribune – www.newsofbahrain.com
Bahrain Bourse announced plans to adopt the Global Industry Classification Standard (GICS) for listed companies effective 11th July 2021.
Chief Executive Officer of Bahrain Bourse, Shaikh Khalifa Bin Ebrahim Al-Khalifa commented: “The industrial re-classification aims to introduce a global industry classification standard to the equity market to enhance transparency and provide more reliable information on the performance of companies and the market in particular that is aligned to international best practices.”
The GICS is a global hierarchical industry classification standard developed by index providers MSCI and S&P Dow Jones Indices and it covers 11 sectors representing the first level of GICS.
Of the 11 industrial sector groups, companies currently listed on Bahrain Bourse will be reclassified into seven industrial sector groups based on their principal business activity.
(Level 1): materials (include one company), industrials (covering Capital Goods, and Commercial & Professional Services and Transportation) include three companies, consumer discretionary (covering Consumer Services, Retailing, Automobiles & Components, and Consumer Durables & Apparel) include five companies, consumer staples (covering Food & Staples Retailing, and Food, Beverage & Tobacco, and Household & Personal Products) include four companies, financials (covering Banks, Insurance, and Diversified Financials) include 22 companies, communication services (covering Telecommunication Services, and Media & Entertainment) include three companies, and real estate (covering REITs, and Real Estate Management & Development) include three companies.
The remaining four industrial sector groups (Energy, Healthcare, Information Technology, and Utilities) will remain inactive as there are currently no companies listed on Bahrain Bourse under those groups.
Bahrain Bourse plans to conduct various public awareness sessions and workshops to raise awareness on this initiative. Bahrain Bourse’s earlier sector classification had been in place since the establishment of Bahrain Bourse in 1987.
Previously, Bahrain Bourse consisted of six sectors. Sectorial indices will be re-calculated with a starting base value of 3,000 points for all sectors, except for the biggest sectoral index which is the Financials covering 22 companies, which will be re-calculated with a base value of 5,500 points.
Historic data for the new sectorial indices will be calculated based on a trailing 12-months period average.
Furthermore, the current sectoral indices will no longer be calculated, however, their historical values will continue to be available on Bahrain Bourse’s website on the New Industry Classification page.