An index divisor is a crucial number in the calculation of the value of an index. It is the basis for comparability across time, and the starting point for adjustments that need to be made due to changes in the equity composition of the underlying companies in the index.

An index divisor is a mathematical number, used in the calculation of a stock index like Sensex & Nifty. This number is calculated by dividing the base year’s index value by base period’s market capitalization of the concerned stock market.