RIL, Infosys, ICICI Bank, TCS Shares Likely To See $130 Million In Outflow After MSCI Review: Report

MSCI also made changes to its MSCI Global Small Cap indexes, including 40 additions and 11 deletions from the MSCI India list

Index provider MSCI Inc. added eight Indian equities to its emerging markets index on Friday as part of its August review. As per the announcement by MSCI, the changes in constituents of the MSCI Global Standard Indexes will take place as of the close of August 31, 2023. Following the changes to MSCI indices, Nuvama Institutional Equities estimate that Reliance Industries Ltd, ICICI Bank Ltd, HDFC Bank Ltd, Infosys Ltd, and Tata Consultancy Services are among the two dozen stocks that might up to $130 million in outflows, reported Business Today. The brokerage firm also said that PI Industries, which has gained weightage, may receive $16 million in inflows.

MSCI Global Standard Index is widely used for measuring global equity portfolios by global investment institutions. Ashok Leyland, Astral Ltd, Cummins India, HDFC Asset Management Company, IDFC First Bank, Power Finance Corporation, REC, and Supreme Industries will be included in the MSCI India Index, according to the index provider's August review. According to the change, ACC would be deleted from the index.

MSCI also made changes to its MSCI Global Small Cap indexes, including 40 additions and 11 deletions from the MSCI India list. Mishra Dhatu Nigam, PTC Industries, Glenmark Life Sciences, Five Star Business Finance, Anant Raj, CPCL, Ather Industries, Ami Organics, Marksans Pharma, Newgen Software, and Patel Engineering were among the companies added. Tata Communications, Aditya Birla Capital, Ashok Leyland, IDFC First Bank, REC, NIIT, BEML Land Asset, and Astral are among the indices that were removed.

As per the BT report, Nuvama Institutional Equities said that Reliance Industries is anticipated to experience outflows of around $130 million, followed by ICICI Bank ($78 million) and Infosys ($77 million). HDFC Bank ($58 million) and TCS ($53 million) are also projected to witness outflows exceeding $50 million. Additional stocks such as Axis Bank, Kotak Mahindra Bank, Bajaj Finance, Bharti Airtel, Larsen & Toubro, Wipro, Mahindra & Mahindra, ITC, and Maruti Suzuki are expected to see similar outflows.

The inclusion of Power Finance Corporation Ltd (PFC), REC Ltd, Ashok Leyland Ltd, and five other stocks might result in inflows of $150-200 million for these stocks. Notably, ACC, a stock from the Adani group, is the sole scrip being excluded from the list. This exclusion is predicted to lead to outflows of $75 million for ACC, as per the Brokerage.