MSCI Index Rejig: Glenmark, Indiabulls Housing, Vodafone Idea, Yes Bank Removed; ICICI Pru Life, HDFC AMC, Six Others Added
MSCI will remove four companies that have seen significant market capitalisation erosion this year from its Global Standard Index.
MSCI Inc.—the world’s biggest index compiler with about $12 trillion in assets benchmarked to its products —will remove four companies that have seen significant market capitalisation erosion this year from its Global Standard Index.
MSCI will drop Glenmark Pharmaceuticals Ltd., Indiabulls Housing Finance Ltd., Vodafone Idea Ltd., and Yes Bank Ltd. from the index, according to its statement,
while eight firms will be added.
MSCI Global Standard Index is widely used by global fund houses for benchmarking global equities portfolios.
Insurance companies were the key additions to the index. In the consumer segment, Berger Paints India Ltd. and Colgate-Palmolive (India) Ltd. were added. Apart from these additions, current weightage has been increased for companies like ICICI Bank Ltd. and ICICI Lombard General Insurance Company Ltd.
The changes will be effective as of the close trade on Nov. 26.
MSCI Index Additions:
Troubled private lender Yes Bank’s shares have slumped more than 60 percent this year, while the Vodafone Idea stock has dropped nearly 83 percent so far in 2019. Indiabulls Housing Finance, whose shares have fallen 72 percent in the same period, was axed from the NSE Nifty 50 Index in September. Glenmark Pharmaceuticals’ stock has declined nearly 58 percent this year.
With this round of changes, the weightage of MSCI’s top 10 constituents will be as follows:
- HDFC Bank Ltd.: 10.14 percent
- Reliance Industries Ltd.: 8.42 percent
- HDFC Ltd.: 7.03 percent
- ICICI Bank Ltd.: 5.42 percent
- Infosys Ltd.: 4.77 percent
- Tata Consultancy Services Ltd.: 4.29 percent
- Kotak Mahindra Bank Ltd.: 3.94 percent
- Axis Bank Ltd.: 3.35 percent
- ITC Ltd.: 3.18 percent
- Hindustan Unilever Ltd.: 2.85 percent
The MSCI India index is designed to measure the performance of the large-cap and midcap segments of the Indian market. The latest rejig will bring the number of Indian stocks in the index to 84, from 80 earlier.