The review also includes a weight adjustment for AU Small Finance Bank, driven by a change in free float, which will lead to an increase in its representation within the index. Despite the reshuffle in constituents, India’s overall weight in the MSCI Standard Index will remain unchanged at 14.1%. However, the total number of Indian companies in the index will rise marginally to 165 from 164 earlier.
Estimates from Nuvama Alternative & Quantitative Research suggest that Aditya Birla Capital could attract inflows of about $257 million. L&T Finance is projected to see inflows of around $238 million. In contrast, IRCTC is likely to witness estimated outflows of about $142 million following its exclusion. AU Small Finance Bank may receive inflows of nearly $172 million due to the increase in its index weight.
Alongside the changes in the Standard Index, MSCI has also made multiple revisions to the Small Cap Index. The Indian small cap universe has seen a significant number of removals, with more than a dozen stocks set to be excluded. As a result, the number of Indian companies represented in the Small Cap Index will decline from 508 to 480 after the latest rejig takes effect.
The new inclusions include Premier Energies, NSDL, Emcure Pharmaceuticals, JSW Cement, Ashapura Minechem, Canara HSBC Life Insurance and Thyrocare Technologies.
At the same time, the Small Cap Index has seen a significant number of exclusions from India. Stocks set to be removed include L&T Finance, Gokaldas Exports, Sterlite Technologies, KNR Constructions, J Kumar Infraprojects, VRL Logistics, Ashoka Buildcon, Anup Engineering, Chemplast Sanmar, Websol Energy Systems, Kaveri Seed Company, Zaggle Prepaid Ocean Services and Symphony.
MSCI said that adjustments related to this round of the index rejig will be carried out during the final few minutes of trading on February 27.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times.)