When will the insolvent scandal group Wircard be removed from the Dax, investors ask?. There should be clarity in the course of the week. By 13. August at the latest, Deutsche Borse intends to publish the results of a consultation with market participants on changes to the index rules. The implementation will then take about a week.
Wirecard had to leave the top German stock exchange league in August – instead of after the regular index review at the beginning of September. The food delivery service Delivery Hero and the fragrance and flavoring manufacturer Symrise are considered candidates for promotion to the index of the 30 heavyweights in the stock exchange.
Revised rules and regulations after scandal
The Deutsche Borse announced a revision of the rules for the Dax share index following criticism of the handling of the insolvent payment service provider Wirecard, which was involved in an accounting scandal. Up to now, a company has only had to file for bankruptcy in the event of liquidation or rejection of the application to open insolvency proceedings for lack of assets "immediately" be removed from a selection index.
Wirecard had taken Commerzbank’s place on the Dax in September 2018. In this June, the company admitted air bookings of 1.9 billion euros. The public prosecutor’s office in Munich is now investigating a "of a commercial gang fraud at the company" at the company since 2015. A company’s stock exchange turnover (trading volume) and stock market value (market capitalization) are decisive for its inclusion in the 30 Dax companies.
Flavor manufacturer Symrise, which is considered a candidate for advancement, is little known to the public. The odors and flavors produced by the Holzminden-based company can be found in many products, such as shampoo, toothpaste and food. The company, which employs more than 10.000 employees, earned 304 million euros last year on sales of 3.4 billion euros.
Food delivery service still making losses
The food delivery service Delivery Hero made a profit last year thanks to the sale of its German business. But operationally the company is still in the red. He could not yet give a forecast of when the current business would break even, CFO Emmanuel Thomassin said in June. Delivery Hero operates food ordering platforms for local suppliers in more than 40 countries and employs 25,000 people.000 employees. This year, the Berlin-based company expects global sales of between 2.4 billion and 2.6 billion euros.
Index changes are especially important for funds that exactly track indices (ETFs). There then has to be reallocation, which usually has an impact on share prices. Membership of the Dax is also a question of prestige: For international investors in particular, Germany’s most important stock market barometer is the flagship of the German economy. The composition of the Deutsche Borse stock indices is reviewed on a quarterly basis. The next regular date is 3. September 2020.