In the latest MSCI August rebalancing, Vodafone Idea and RVNL are among the seven stocks set to be included in the India Index. Meanwhile, Bandhan Bank will be excluded from the index.
In the upcoming MSCI India Standard Index rebalancing, set for August 30, several stocks are anticipated to be added to the index. Among the potential inclusions are
- Dixon Technologies
- Vodafone Idea
- Zydus Life Sciences
- Oracle Financial Services Software (OFSS)
- Rail Vikas Nigam Limited (RVNL)
- Prestige Estates Project
- Oil India Ltd
Expected Inflows
Due to this inclusion, RVNL is likely to attract passive fund inflows worth $219 million while Vodafone Idea may likely be infused with $278 million, as per the estimates by domestic brokerage firm Nuvama Alternative & Quantitative Research.Meanwhile, Bandhan Bank will likely witness outflows worth $125 million due to the exclusion.
Dixon Technology will attract fund inflows worth $283 million, Oil India $238 million, Zydus Life sciences $230 million, Prestige Estate Project $181 million and Oracle Financial Software Services $170 million.
HDFC Bank’s Weightage
HDFC Bank’s weight in the MSCI index is projected to increase to between 7.2% and 7.5% in the August 2024 review, up from the current 3.8%. This adjustment follows a decline in foreign institutional holdings (FII) below 55%, potentially leading to passive inflows of up to $4 billion, according to Nuvama.
The increase in HDFC Bank’s weight will be implemented in two phases. The first phase will occur after the current review, with the second adjustment planned for after the November review, assuming foreign headroom remains at least 20%.
Nuvama Alternative and Quantitative Research forecasts potential inflows of $1.8 billion for HDFC Bank over four-and-a-half days following the initial weight increase.
Recent Stock Performance
In the past month, several stocks expected to join the MSCI India Standard Index have shown varied price movements. Dixon Technologies, RVNL, Vodafone Idea, and Cochin Shipyard experienced declines of 6.4%, 4.8%, 4.3%, and 14%, respectively.
Conversely, Oil India, Zydus Lifesciences, KPIT Technologies, and OFSS saw price increases of 25%, 11%, 2%, and 1%, respectively. These price trends may influence investor sentiment and market reactions leading up to the index rebalancing announcement.
You might also be interested in – Vodafone Idea increases prepaid and postpaid tariffs by 10-20%, following Airtel and Jio
