SEBI Modifies Market Cap Calculation and Selects a 6-Month Average

The method used to determine a public listed entity's market capitalization under the Listing Obligations and Disclosure Requirements (LODR) has been amended by markets regulator SEBI. According to the revisions, rather of using a single day's market capitalization, listed firms will now utilize an average market capitalization over a period of six months to provide a more accurate market size of the company. This new amendment will take effect on December 31, 2024, and going forward, the average market capitalization from June 1 to December 31 will be used to rank compliance. The market capitalization of the business as of March 31, or the end of the fiscal year, was the basis for the ranking in the past.