MSCI’s quarterly rejig will come into effect following the market close on May 31, potentially leading to inflows of around $2 billion into the Indian equity markets. This rebalancing will result in 13 new stocks being added to the MSCI Global Standard Index, while three stocks will be excluded.
The new additions to the MSCI Global Standard Index include Bosch, Canara Bank, Indus Towers, Jindal Stainless, JSW Energy, Mankind Pharma, NHPC, PB Fintech, Phoenix Mills, Solar Industries, Sundaram Finance, Thermax, and Torrent Power.
Consequently, the MSCI index will now include up to 146 Indian counters, up from 136 previously, increasing India’s weight in the MSCI EM Index to 18.8%.
According to Nuvama Institutional Equities, the maximum inflow is anticipated for Indus Towers at $224 million, followed by PB Fintech and Phoenix Mills at $223 million and $213 million, respectively. Other stocks are estimated to see inflows ranging from $144 million to $207 million.
Thermax is considered borderline for inclusion in the MSCI index, and if included, it could attract inflows worth $139 million. Conversely, Paytm, Indraprastha Gas, and Berger Paints will be excluded from the index, potentially leading to combined outflows of around $283 million.
The MSCI Small-Cap Index will also see changes, with 497 listed entities from India being included post-rebalancing. Notable new entrants to the Smallcap index include Waaree Renewable, Vedant Fashions, Va Tech Wabag, RR Kabel, and Sanghvi Movers.
On the other hand, stocks such as Tatva Chintan Pharma, Borosil, Sharda Cropchem, and Dreamfolks Services will be excluded from the MSCI Small-Cap Index.
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