If an investor had Rs 1 lakh parked in BSE Sensex in 1986, it's worth today would have been around Rs 1.57 crore - yes, that's how much the Bombay Stock
Exchange has grown in just 40 years. The Sensex started at 549 points in 1986 and today it's hovering around 86,000 mark, showcasing the jaw-dropping wealth creation in the modern financial history. Another example to understand the journey of Sensex - if you had invested just Rs 10,000 in 1986, today it could have been around Rs 15.7 lakh - a staggering 15,594% returns. "If you ask someone, how is the market today? He'll say, it's up 400-500 points. Which index is he referring to? It's Sensex. It's inside him. He understands, accepts and relates to Sensex as himself, as market, as economy. That is what Sensex has achieved in the last 4 decades," BSE MD and CEO Sundararaman Ramamurthy told ET Markets when asked to comment on the glorious 40 years of Sensex. Over the past 40 years, the Sensex has delivered annualised returns of about 13.4%, closely matching India’s nominal GDP growth of 12.97%. This has reinforced the Sensex’s status as a key indicator of India’s economy, which is currently valued at $4.13 trillion.
A Look At BSE's Journey
Launched in 1986, when India was still a largely closed and agrarian economy, the Sensex has tracked the country’s economic transition over four decades. It rose during the economic reforms of the early 1990s, weathered the Asian financial crisis, benefited from the IT boom, and remained resilient through the 2008 global financial crisis and the Covid-19 pandemic.
The index crossed several major milestones during this period. It moved past 1,000 points in 1990, crossed 10,000 in 2006, reached 50,000 in 2021, and touched 85,000 in 2024. Between 2014 and 2024 alone, the Sensex more than tripled from around 25,000 to 85,000.
Data shows that the Sensex delivered positive returns in 75% of the years over the past four decades. The Total Return Index (TRI), which includes dividends, was positive in 79% of the years. There has been only one year of negative returns in the last 14 calendar years.
The best-performing years for the Sensex were 1988, 1991, 1999, 2003 and 2009, periods linked to economic reforms or recovery phases. The weakest years - 1995, 1998, 2000, 2008 and 2011 - coincided with global crises or domestic economic adjustments.
Sharp market volatility was seen during major events such as the 2020 Covid-19 crash, the 2008–09 global financial crisis, and 1991–92, when market reforms and the Harshad Mehta scam unsettled investors. Over time, large single-day market swings have become less frequent, reflecting improved liquidity and wider investor participation.
Changes in the Sensex’s sector composition also reflect shifts in India’s economy, according to BSE data. Financial services now account for 39.5% of the index in 2025, up from 22.25% in 2005. The weight of IT stocks declined from 19.9% to 12.95%, while consumer discretionary stocks rose from 4.93% to 12.95%. The share of commodities fell from 8.97% to 2.98%, and energy stocks declined from 16.11% to 9.72%.
“The representation in the index is reflective of what the market economy is, and that is probably why it's called as a true barometer of not just the market, but also the economy,” Ramamurthy said. “Sensex has seen the transformation of India from being an agrarian economy, slight shift to manufacturing and then services. It reflects a growing country.”
Four companies - HUL, Larsen & Toubro, ITC and Reliance Industries - have remained part of the Sensex continuously since its launch in 1986, highlighting their long-term business strength.
The Sensex was launched with a base value of 100, back-calculated to 1978–79, and opened at 549.43 on January 2, 1986. Forty years later, it remains a key benchmark for investors and a symbol of India’s economic growth.
“Returns are good but to capture the attention of the public isn't that easy. To retain it for 40 years and grow along with it is not easy,” Ramamurthy said.
