In a significant reshuffle of the benchmark Sensex index, retail powerhouse Trent Ltd. and public sector giant Bharat Electronics Ltd. (BEL) are set to be added to the 30-stock pack starting June 20. This update marks a strategic shift, as Nestle India Ltd. and IndusInd Bank Ltd. are scheduled to exit the index.
According to estimates by Nuvama Alternative & Quantitative Research, these changes are poised to trigger notable investment flows. Trent and BEL are expected to attract passive inflows of $330 million and $378 million, respectively. Conversely, Nestle India and IndusInd Bank’s removal could lead to outflows of around $230 million and $145 million.
“Historically, stocks added to the Sensex tend to witness strong intraday performance, buoyed by increased trading volumes,” Nuvama noted, hinting at a possible repeat of this pattern.
UltraTech Cement Gains Weightage
In terms of weightage adjustments within the index, UltraTech Cement stands out as the only stock set to see a rise in its Sensex weight, drawing in $4 million in passive flows. On the flip side, several index heavyweights—including HDFC Bank, Reliance Industries, Infosys, and TCS—are expected to face reduced allocations, collectively resulting in $249 million in outflows.
Broader Index Changes: BSE 100, Sensex 50 & Next 50
The rebalancing extends beyond the Sensex:
- BSE 100: Dixon Technologies, Coforge Ltd, and Indus Towers Ltd will join the index, replacing Bharat Forge, Dabur India, and Siemens Ltd.
- BSE Sensex 50: InterGlobe Aviation Ltd (IndiGo) and Shriram Finance Ltd will be included, while Britannia Industries and Hero MotoCorp Ltd make their exit.
- BSE Sensex Next 50: Reflecting the shifts in other indices, Britannia, Dixon Technologies, Coforge, Hero MotoCorp, and Indus Towers will be added. InterGlobe Aviation, Shriram Finance, Bharat Forge, Dabur India, and Siemens will move out.
These updates are part of the semi-annual index rejig process and aim to ensure that the indices better represent the evolving dynamics of India’s equity markets. Investors, especially those tracking passive funds, will be closely watching the impact as these changes go live.
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