Watchmaker to be removed from 30-company index
Falling sales in China contribute to share fall
To be replaced by Helvetia Baloise after insurers merge
ZURICH, – Swatch Group will be removed from the benchmark Swiss Leader Index next month, stock exchange operator SIX said, after a decline in the watchmaker’s market capitalization and lower trading volumes in its shares.
The maker of Omega, Tissot and Longines watches will be replaced by Helvetia Baloise Holding in the 30-firm SLI basket from December 22, following the merger of Helvetia and Baloise to create Switzerland’s second-largest insurance group.
SIX, which normally reviews the composition of its indexes every September, said Helvetia Baloise would replace Swatch in the SLI following the extraordinary adjustment.
The composition of the indexes reflects trading volumes and the market capitalisation of companies’ free float over the previous 12 months.
SWATCH SHARES SLIP ON LOWER PROFITS, FALLING CHINA SALES
Swatch shares have lost 5% in value over the last 12 months as sales fell and profits plunged due to falling sales in China.
As a result, its market capitalisation has shrunk to 8.66 billion Swiss francs , while average trading volumes of its shares have also fallen by a nearly one-third this year.
Swatch Group was removed from the blue-chip Swiss Market Index in September 2021, when it was replaced by computer peripherals maker Logitech.
The SLI is a broader benchmark of Swiss companies, representing the top 20 blue-chip companies on the Swiss Market Index plus the 10 largest mid-cap stocks from the Swiss Market Index Mid.
The benchmark is used by index funds, ETC and derivatives, who track it by holding its 30 constituents in the same proportions, to give investors exposures to Swiss large and mid cap stocks in one product.
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