The Sensex has scaled yet another high crossing the 39,000-mark on its 40th birthday, continuing its robust growth over the years. We take a look at its 40-year journey.
The Sensex has scaled yet another high crossing the 39,000-mark on its 40th birthday, continuing its robust growth over the years. Notably, the 30-share index came into being on April 1, 1979 with a base value of 100. The growth over the last 40 years represents a 16% CAGR return to the shareholders. After taking into account the dividends, the value of Sensex stands at a whopping 56,000. “If we take dividends in to account, on total return basis, it would be close to 56,000. Congratulations India for the stupendous growth,” Ashish Chauhan, CEO of BSE said in a tweet. We take a closer look at the journey, ans the top 10 landmarks of Sensex in the last 40 years.
The birth of Sensex
The Sensex made its debut on April 1, 1979 with a base value of 100. The BSE started publishing values of the Sensex in 1985, by when the gauge had crawled to the 400-mark.
The Sensex crossed the 1,000 mark in 1990, 11 years after its launch, on the back of good monsoon and upbeat corporate results.In this period, the Sensex grew at a CAGR of 23.28%.
Journey to 5,000
It took nearly a decade for the Sensex to move to the crucial 5,000-mark. Interestingly, while the Sensex had reached the 4,000-mark in March 1992, the index soon crashed to less than 2,000 points on the back of unfolding of a stock market scam. The Sensex crossed the 5,000 mark on December 30, 1999.
The Sensex doubled to hit the 10,000-mark, in less than 6 years in 2006. Owing to a sharp run in commodity pricing, Sensex scaled the 5 figure-mark for the first time ever. Interestingly, the 10,000-mark also represents a 100 times growth in a span of 27 years, implying a CAGR of 18.60%.
Stellar growth to 20,000
While the first 10,000 had taken 27 years, the next 10,000 points came in just 18 months. On October 29, 2007 Sensex topped the crucial 20,000 mark. “On the back of the rise in investments from foreign institutional investors and aggressive retail buying, Sensex touched the 20,000 level for the first time in 2007,” noted a Kotak report.
The fall after crisis
While the growth had been stellar thus far, the Sensex could not hold on and plunged to less than 8,000. In October 2008, the Sensex was below 7,700-mark, erasing gains made over the last many years.
Sensex rebuilds to 25,000
While the sub-prime crisis was a major setback to the index, the Sensex successfully rebuilt from the lows of 2007, to surge past the crucial 25,000-mark in 2014, after Narendra Modi-led BJP stormed to power.
Robust rally to 30,000
Sensex spurred to cross the 30,000-mark backed by global liquidity provided by central banks of major economies in less than a year. The Sensex gained past the 30,000-mark in March 4, 2015, less than one year after it had hit the 30,000-mark.
Journey to 38,000
Sensex crossed the 38,000-mark for the first time ever in August 2018 on account of India’s economic growth expectations. Interestingly, the 8,000 point gain took less than four years.
Record high of 39,000
The 30-share index moved beyond the 39,000-mark on April 1, 2019, on its 40th birth anniversary. In effect, in the last 40 years, the Sensex has risen 560 times. The stellar growth works out to a CAGR of more than 16%.