MSCI index review: The big gainers and losers

Morgan Stanley Capital International has announced the addition of Max Healthcare, Hindustan Aeronautics and Sona BLW Precision to its India Standard Index, as part of May 2023 rejig.

As per preliminary calculations done by Nuvama Alternative & Quantitative Research, this could result in an inflow of $295 million for Max Healthcare, $195 million for HAL and $175 for Sona BLW.

On the other hand, Adani Transmission, Adani Total Gas and Indus Towers have been deleted from the MSCI India Standard Index, which could lead to outflows of $201 million, $186 million and $84 million respectively.

These changes are key to tracking as many exchange-traded funds and index funds are benchmarked to it. The MSCI passive trackers will implement the changes on May 31.

Smallcap changes

The index provider has also rejigged its India Small Cap index.

New additions to the list include KFin Technologies, Kaynes Technology, Bikaji Foods, Fusion Micro Finance, Syrma SGS Technology, Religare Enterprises, NMDC Steel, ACE, Ujjivan Small Finance Bank, Maharashtra Seamless, RVNL and IRCON.

The ones removed from the index are: Max Healthcare, Polycab India, Gillette India, Dhani Services, Radico Khaitan, Astec Lifescience, Dilip Buildcon, Thyrocare and PC Jewellers.

Weight additions and reductions

MSCI has announced the biggest weight increase in Kotak Mahindra Bank, which could lead to inflow of $810 million. Foreign investors’ shareholding in the bank had dropped 1.47 percentage points in the March quarter, thus opening up the foreign room and making it eligible to weight increase.

Maruti Suzuki ($87 million) ONGC ($74 million), Ultratech Cement ($72 million), Interglobe Aviation ($63 million) and Zomato ($59 million) are some other stocks that will see their weight go up in the MSCI index.

Prominent weight reductions are in Reliance Industries, Infosys, ICICI Bank, JSW Steel, HDFC and Tata Consultancy Services. This could result in outflow worth $155 million, $134 million, $94 million, $80 million, $71 million and $61 million, respectively.

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