MSCI's Quarterly Rebalancing Set for $2B Inflow in Indian Equity

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MSCI's quarterly rebalancing adds 13 stocks to its Global Standard Index, raising India's MSCI EM Index weight to 18.8%. Potential inflows of $2 billion are anticipated, with top beneficiaries including Indus Towers, PB Fintech, and Phoenix Mills.

MSCI Rebalancing News Today

MSCI's quarterly rebalancing, scheduled to take effect after market close on May 31, is poised to inject approximately $2 billion into Indian equity markets. This move will see significant adjustments to the MSCI Global Standard Index, impacting various Indian stocks.

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Inclusions and Exclusions

Thirteen new stocks are set to join the MSCI Global Standard Index, including Bosch, Canara Bank, Indus Towers, Jindal Stainless, JSW Energy, Mankind Pharma, NHPC, PB Fintech, Phoenix Mills, Solar Industries, Sundaram Finance, Thermax and Torrent Power. The index is expanding to accommodate up to 146 Indian counters

Conversely, three stocks, namely Paytm, Indraprastha Gas, and Berger Paints will be excluded from the index.

Anticipated Inflows

Nuvama Institutional Equities forecasts substantial inflows for select stocks, with Indus Towers expected to receive the highest at $224 million, followed by PB Fintech and Phoenix Mills. Other inclusions may witness inflows ranging from $144 to $207 million. Thermax stands on the cusp of inclusion, with potential inflows of $139 million.

Impact on Excluded Stocks

Excluded stocks such as Paytm, Indraprastha Gas, and Berger Paints could experience combined outflows of approximately $283 million due to their removal from the MSCI index.

Changes in the MSCI Small Cap Index

The MSCI Small Cap Index will also undergo modifications, incorporating 497 listed entities from India. Inclusions like Waaree Renewable and Vedant Fashions will join, while exclusions such as Tatva Chintan Pharma and Borosil are expected.

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This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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